IDEAS home Printed from https://ideas.repec.org/a/eee/tefoso/v120y2017icp14-23.html
   My bibliography  Save this article

The globalization of R&D's implications for technological capabilities in MNC home countries: Semiconductor design offshoring to China and India

Author

Listed:
  • Fuller, Douglas B.
  • Akinwande, Akintunde I.
  • Sodini, Charles G.

Abstract

This paper addresses the empirical question of the impact of the offshoring of semiconductor design to India and China on the generation of semiconductor design skills in the offshoring multinational corporations' (MNCs) home countries. There are four main findings. First, there is a specific technology skill ladder for training “design leads” or design managers within this industry that entails direct exposure to a wide range of design activities. Thus, offshoring has potentially serious implications for development of further design leads. Second, the paper also finds that the impact on skills activities and thus potential skills generation at home from offshoring to India has been limited and gradual and from offshoring to China has been even more limited although the activities done in each country by MNCs have risen over time. Third, the fuzzy set qualitative comparative analysis pinpoints that the operations with design leads and large design teams in 2003–2007 in conjunction with other attributes are generally the ones that pursued the most extensive expansion of semiconductor design offshoring during the subsequent 2009–2013 period. Finally, the evidence for a gradual process of offshoring from the second and third points suggests that offshoring in semiconductor design will most likely not displace the large amount of design activities in the home countries of the MNCs in the near future.

Suggested Citation

  • Fuller, Douglas B. & Akinwande, Akintunde I. & Sodini, Charles G., 2017. "The globalization of R&D's implications for technological capabilities in MNC home countries: Semiconductor design offshoring to China and India," Technological Forecasting and Social Change, Elsevier, vol. 120(C), pages 14-23.
  • Handle: RePEc:eee:tefoso:v:120:y:2017:i:c:p:14-23
    DOI: 10.1016/j.techfore.2017.03.032
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0040162517304080
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.techfore.2017.03.032?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Brown, Clair & Linden, Greg, 2005. "Offshoring in the Semiconductor Industry: Historical Perspectives," Institute for Research on Labor and Employment, Working Paper Series qt0wv0k78t, Institute of Industrial Relations, UC Berkeley.
    2. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-2168, October.
    3. Feenstra, Robert C & Hanson, Gordon H, 1996. "Globalization, Outsourcing, and Wage Inequality," American Economic Review, American Economic Association, vol. 86(2), pages 240-245, May.
    4. Ragin, Charles C., 2000. "Fuzzy-Set Social Science," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226702773, October.
    5. Arie Lewin & Silvia Massini & Carine Peeters, 2008. "Why are companies offshoring innovation ?the emerging global race for talent," Working Papers CEB 08-009, ULB -- Universite Libre de Bruxelles.
    6. Richard B. Freeman, 2006. "Does Globalization of the Scientific/Engineering Workforce Threaten US Economic Leadership?," NBER Chapters, in: Innovation Policy and the Economy, Volume 6, pages 123-158, National Bureau of Economic Research, Inc.
    7. Fuller, Douglas B., 2014. "Chip design in China and India: Multinationals, industry structure and development outcomes in the integrated circuit industry," Technological Forecasting and Social Change, Elsevier, vol. 81(C), pages 1-10.
    8. Catherine L. Mann, 2003. "Globalization of IT Services and White Collar Jobs: The Next Wave of Productivity Growth," Policy Briefs PB03-11, Peterson Institute for International Economics.
    9. Farok J. Contractor & Vikas Kumar & Sumit K. Kundu & Torben Pedersen, 2010. "Reconceptualizing the Firm in a World of Outsourcing and Offshoring: The Organizational and Geographical Relocation of High‐Value Company Functions," Journal of Management Studies, Wiley Blackwell, vol. 47(8), pages 1417-1433, December.
    10. Lorena M. D'Agostino & Keld Laursen & Grazia D. Santangelo, 2013. "The impact of R&D offshoring on the home knowledge production of OECD investing regions," Journal of Economic Geography, Oxford University Press, vol. 13(1), pages 145-175, January.
    11. Dieter Ernst, 2003. "Internationalisation of Innovation: Why Chip Design Moving to Asia," Economics Study Area Working Papers 64, East-West Center, Economics Study Area, revised Mar 2004.
    12. Ragin, Charles C., 2006. "Set Relations in Social Research: Evaluating Their Consistency and Coverage," Political Analysis, Cambridge University Press, vol. 14(3), pages 291-310, July.
    13. Lori G. Kletzer, 2001. "Job Loss from Imports: Measuring the Costs," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 110, January.
    14. repec:bla:jomstd:v:47:y:2010:i:s2:p:1417-1433 is not listed on IDEAS
    15. Martin R Schneider & Conrad Schulze-Bentrop & Mihai Paunescu, 2010. "Mapping the institutional capital of high-tech firms: A fuzzy-set analysis of capitalist variety and export performance," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 41(2), pages 246-266, February.
    16. Paul A. Samuelson, 2004. "Where Ricardo and Mill Rebut and Confirm Arguments of Mainstream Economists Supporting Globalization," Journal of Economic Perspectives, American Economic Association, vol. 18(3), pages 135-146, Summer.
    17. Jagdish N. Bhagwati, 2004. "In Defense of Globalization: It Has a Human Face," Rivista di Politica Economica, SIPI Spa, vol. 94(6), pages 9-20, November-.
    18. repec:ucp:bkecon:9780226702766 is not listed on IDEAS
    19. Martin Kenney & Silvia Massini & Thomas P Murtha, 2009. "INTRODUCTIONOffshoring administrative and technical work: New fields for understanding the global enterprise," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(6), pages 887-900, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Patel, Pankaj C. & Parida, Vinit & Jayaram, Jayanth & Oghazi, Pejvak, 2018. "Task equivocality and process modularity in R&D offshore collaboration projects," Journal of Business Research, Elsevier, vol. 93(C), pages 12-22.
    2. Guo, Yulian & Wang, Feilan & Li, Ping, 2024. "The interplay of Fintech, natural resources, globalization, and environmental sustainability in China: A BARDL investigation," Resources Policy, Elsevier, vol. 88(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Martin Borowiecki & Bernhard Dachs & Doris Hanzl-Weiss & Steffen Kinkel & Johannes Pöschl & Magdolna Sass & Thomas Christian Schmall & Robert Stehrer & Andrea Szalavetz, 2012. "Global Value Chains and the EU Industry," wiiw Research Reports 383, The Vienna Institute for International Economic Studies, wiiw.
    2. Nidthida Lin, 2020. "Designing Global Sourcing Strategy for Cost Savings and Innovation: A Configurational Approach," Management International Review, Springer, vol. 60(5), pages 723-753, October.
    3. Molintas, Dominique Trual, 2010. "Globalisation impact on Danish SME: Offshore Outsourcing & local competitiveness," MPRA Paper 96529, University Library of Munich, Germany.
    4. Rosario Crinò, 2009. "Offshoring, Multinationals And Labour Market: A Review Of The Empirical Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 23(2), pages 197-249, April.
    5. Weng, David H. & Peng, Mike W., 2018. "Home bitter home: How labor protection influences firm offshoring," Journal of World Business, Elsevier, vol. 53(5), pages 632-640.
    6. Federica Nieri & Luciano Ciravegna & Ruth V. Aguilera & Elisa Giuliani, 2019. "Larger, more internationalized, better behaved? A configurational study of em erging market multinational enterprises' involvement in corporate wrongdoing," Discussion Papers 2019/255, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    7. Rosario Crinò, 2010. "Service Offshoring and White-Collar Employment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 77(2), pages 595-632.
    8. Valle, Sandra & García, Francisco & Avella, Lucía, 2015. "Offshoring Intermediate Manufacturing: Boost or Hindrance to Firm Innovation?," Journal of International Management, Elsevier, vol. 21(2), pages 117-134.
    9. Jensen, Peter D. Ørberg, 2012. "A passage to India: A dual case study of activities, processes and resources in offshore outsourcing of advanced services," Journal of World Business, Elsevier, vol. 47(2), pages 311-326.
    10. J. Bradford Jensen & Lori G. Kletzer, 2005. "Tradable Services: Understanding the Scope and Impact of Services Outsourcing," Working Paper Series WP05-9, Peterson Institute for International Economics.
    11. Paulo Lopes Henriques & Carla Curado & Mírian Oliveira & Antônio Carlos Gastaud Maçada, 2019. "Publishing? You can count on knowledge, experience, and expectations," Quality & Quantity: International Journal of Methodology, Springer, vol. 53(3), pages 1301-1324, May.
    12. Daniela Cristofoli & Benedetta Trivellato & Alessandro Sancino & Laura Maccio’ & Josip Markovic, 2021. "Public network leadership and the ties that lead," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 25(1), pages 251-274, March.
    13. Mary Amiti & Shang‐Jin Wei, 2009. "Service Offshoring and Productivity: Evidence from the US," The World Economy, Wiley Blackwell, vol. 32(2), pages 203-220, February.
    14. Piñeiro-Chousa, Juan Ramón & López-Cabarcos, M. Ángeles & Pérez-Pico, Ada María, 2016. "Examining the influence of stock market variables on microblogging sentiment," Journal of Business Research, Elsevier, vol. 69(6), pages 2087-2092.
    15. Jan Hogrefe & Jens Wrona, 2015. "Trade, tasks and training: The effect of offshoring on individual skill upgrading," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(4), pages 1537-1560, November.
    16. Muñoz, Pablo & Dimov, Dimo, 2015. "The call of the whole in understanding the development of sustainable ventures," Journal of Business Venturing, Elsevier, vol. 30(4), pages 632-654.
    17. Adame, Consolación & Caplliure, Eva-María & Miquel, María-José, 2016. "Work–life balance and firms: A matter of women?," Journal of Business Research, Elsevier, vol. 69(4), pages 1379-1383.
    18. Asimakopoulos, Grigorios & Revilla, Antonio & Rodríguez, Alicia, 2023. "International R&D sourcing, innovation and firm age: The advantage of ‘born-international sourcers’," Technovation, Elsevier, vol. 122(C).
    19. Khedhaouria, Anis & Thurik, Roy, 2017. "Configurational conditions of national innovation capability: A fuzzy set analysis approach," Technological Forecasting and Social Change, Elsevier, vol. 120(C), pages 48-58.
    20. Liu, Runjuan & Trefler, Daniel, 2019. "A sorted tale of globalization: White collar jobs and the rise of service offshoring," Journal of International Economics, Elsevier, vol. 118(C), pages 105-122.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:tefoso:v:120:y:2017:i:c:p:14-23. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.sciencedirect.com/science/journal/00401625 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.