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Overseas R&D Activities by Multinational Enterprises: Evidence from Japanese Firm-Level Data

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Author Info
Yasuyuki Todo
Satoshi Shimizutani

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Abstract

This paper investigates both the determinants and the impact of overseas subsidiaries' R&D activities, using firm-level panel data for Japanese multinational enterprises. We distinguish between overseas innovative and adaptive R&D and find substantial differences between the two types of R&D. The evidence suggests that overseas innovative R&D aims at the exploitation of foreign advanced knowledge, and by doing so, it helps to raise the productivity of the parent firm. In contrast, the primary role of overseas adaptive R&D is to enhance the productivity of overseas subsidiaries through the use of parent firms' knowledge. In addition, we find no complementarity between home and overseas innovative R&D, i.e., no evidence that overseas innovative R&D raises the marginal effect of home R&D on home productivity.

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Paper provided by Institute of Economic Research, Hitotsubashi University in its series Hi-Stat Discussion Paper Series with number d05-91.

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Date of creation: May 2005
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Handle: RePEc:hst:hstdps:d05-91

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Related research
Keywords: overseas R&D activities; multinational enterprises; total factor productivity;

Find related papers by JEL classification:
F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
O30 - Economic Development, Technological Change, and Growth - - Technological Change - - - General

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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. SHIMIZUTANI Satoshi & TODO Yasuyuki, 2007. "What Determines Overseas R&D Activities? The Case of Japanese Multinational Firms," Discussion papers 07010, Research Institute of Economy, Trade and Industry (RIETI). [Downloadable!]
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