Subsidizing Away Exports? A Note on R&D-policy towards Multinational Firms
AbstractIn this paper, I investigate whether instead of strengthening home-based production, government R&D-subsidies can induce R&D-intensive firms to locate production abroad. Investigating firm-level data on Swedish MNEs, however, I find no evidence of such relocation. R&D subsidies rather tend to en courage export production at the expense of foreign production. The theory presented suggests that this is consistent with technology transfer costs, which outweigh trade costs for physical goods.
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Bibliographic InfoPaper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 832.
Length: 29 pages
Date of creation: 19 May 2010
Date of revision:
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More information through EDIRC
Multinational Firms; R&D; Subsidies; Location; Empirical Analyses;
Other versions of this item:
- Pehr-Johan Norbäck, 2011. "Subsidizing Away Exports? A Note on R&D-policy Towards Multinational Firms," Journal of Industry, Competition and Trade, Springer, vol. 11(1), pages 25-42, March.
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-05-29 (All new papers)
- NEP-INO-2010-05-29 (Innovation)
- NEP-INT-2010-05-29 (International Trade)
- NEP-SBM-2010-05-29 (Small Business Management)
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