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Importance of International Linkages for Local Know-How Flows. Some Econometric Evidence from Belgium

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Author Info
Reinhilde Veugelers
Bruno Cassiman

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Abstract

External knowledge is an important input for the innovation process of firms. Increasingly, this knowledge is likely to originate from outside of their national borders. This explains the preoccupation of policymakers with stimulating local technology transfers coming from international firms. We find that firms that have access to the international technology market are more likely to transfer technology to the local economy. In doing so, we qualify the traditional assertion that multinational firms are more likely to transfer technology to the local economy. Once controlled for the superior access to the international technology market that multinationals enjoy, we find that these firms are not more likely to transfer technology to the local economy compared to exporting or local firms that have access to the international technology market. In summary, the main result of this paper is that it is not so much the international character of the firms, but rather their access to the international technology market that is important for generating external knowledge transfers to the local economy.

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Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 434.

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Date of creation: Jan 2000
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Handle: RePEc:upf:upfgen:434

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Related research
Keywords: International technology transfers; know-how flows; cooperation in R&D; host economy benefits;

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Find related papers by JEL classification:
D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
O32 - Economic Development, Technological Change, and Growth - - Technological Change - - - Management of Technological Innovation and R&D

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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. Frank Lichtenberg & Bruno van Pottelsberghe de la Potterie, 1996. "International R&D Spillovers: A Re-Examination," NBER Working Papers 5668, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Neven, D. & Siotis, G., 1996. "Technology sourcing and FDI in the EC: An empirical evaluation," International Journal of Industrial Organization, Elsevier, vol. 14(5), pages 543-560, July. [Downloadable!] (restricted)
    Other versions:
  3. Blomstrom, Magnus & Kokko, Ari, 1998. " Multinational Corporations and Spillovers," Journal of Economic Surveys, Blackwell Publishing, vol. 12(3), pages 247-77, July. [Downloadable!] (restricted)
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  4. Jonathan Eaton & Samuel Kortum, 1997. "Technology and Bilateral Trade," NBER Working Papers 6253, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  5. Kuemmerle, Walter, 1999. "Foreign direct investment in industrial research in the pharmaceutical and electronics industries--results from a survey of multinational firms," Research Policy, Elsevier, vol. 28(2-3), pages 179-193, March. [Downloadable!] (restricted)
  6. Irwin, Douglas A & Klenow, Peter J, 1994. "Learning-by-Doing Spillovers in the Semiconductor Industry," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1200-1227, December. [Downloadable!] (restricted)
  7. Barrell, Ray & Pain, Nigel, 1999. "Domestic institutions, agglomerations and foreign direct investment in Europe," European Economic Review, Elsevier, vol. 43(4-6), pages 925-934, April. [Downloadable!] (restricted)
  8. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1992. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," NBER Working Papers 3993, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Lall, Sanjaya, 1980. "Vertical Inter-Firm Linkages in LDCs: An Empirical Study," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 42(3), pages 203-26, August.
  10. Blomstrom, Magnus & Sjoholm, Fredrik, 1999. "Technology transfer and spillovers: Does local participation with multinationals matter?1," European Economic Review, Elsevier, vol. 43(4-6), pages 915-923, April. [Downloadable!] (restricted)
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  11. Oxley, Joanne E, 1997. "Appropriability Hazards and Governance in Strategic Alliances: A Transaction Cost Approach," Journal of Law, Economics and Organization, Oxford University Press, vol. 13(2), pages 387-409, October.
  12. Braconier, Henrik & Ekholm, Karolina & Ulltveit-Moe, Karen-Helene, 2000. "Does FDI Work as a Channel for R&D Spillovers? Evidence Based on Swedish Data," CEPR Discussion Papers 2469, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  13. Baldwin, R.E. & Braconier, H. & Forslid, R., 1999. "Multinationals Endogenous Growth and Technological Spillovers: Theory and Evidence," Research Institute of Industrial Economics Working Papers 519, Research Institute of Industrial Economics (IFN).
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Cited by:
(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. Criscuolo,Paola, 2002. "Reverse Technology Transfer: A Patent Citation Analysis of the European Chemical and Pharmaceutical sectors," Research Memoranda 036, Maastricht : MERIT, Maastricht Economic Research Institute on Innovation and Technology. [Downloadable!]
    Other versions:
  2. T.N. Srinivasan & Vani Archana, . "India in the Global and Regional Trade: Determinants of Aggregate and Bilateral Trade Flows and Firms' Decision to Export," Indian Council for Research on International Economic Relations, New Delhi Working Papers 232, Indian Council for Research on International Economic Relations, New Delhi, India. [Downloadable!]
  3. Wolfgang Sofka, 2005. "Global Idea Sourcing - An empirical investigation into the mechanisms behind the usage of foreign business sources for innovation," Industrial Organization 0509004, EconWPA. [Downloadable!]
    Other versions:
  4. Barrios, Salvador & Bertinelli, Luisito & Heinen, Andreas & Strobl, Eric, 2007. "Exploring The Link Between Local And Global Knowledge Spillovers," MPRA Paper 6239, University Library of Munich, Germany. [Downloadable!]
  5. Valeria Gattai, 2009. "Firm’s intangible assets and multinational activity: full versus shared ownership," Working Papers 154, University of Milano-Bicocca, Department of Economics, revised Feb 2009. [Downloadable!]
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