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Multinational experience and the creation of linkages with local firms: evidence from the electronics industry


  • Davide Castellani


This paper focuses on multinational companies' creation of linkages with local firms in the electronics industry. Evidence is drawn from a novel data-set, covering international operations of the top European and US electronics companies, over the period 1984--95. Econometric tests are provided to highlight how firms' multinational experience, measured by the extent of their presence in foreign countries, affects cooperative agreements, as opposed to licensing and foreign direct investments. It is highlighted that multinationals' subsidiary accumulation has a positive and significant impact on collaborative linkages with local firms. This contrasts with the transaction cost view underlying most market-entry literature, but is consistent with a dynamic efficiency perspective which emphasises the role of linkages in learning and knowledge accumulation and exploitation. Copyright 2002, Oxford University Press.

Suggested Citation

  • Davide Castellani, 2002. "Multinational experience and the creation of linkages with local firms: evidence from the electronics industry," Cambridge Journal of Economics, Oxford University Press, vol. 26(1), pages 1-25, January.
  • Handle: RePEc:oup:cambje:v:26:y:2002:i:1:p:1-25

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    References listed on IDEAS

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    Cited by:

    1. Castellani, Davide & Zanfei, Antonello, 2004. "Choosing international linkage strategies in the electronics industry: the role of multinational experience," Journal of Economic Behavior & Organization, Elsevier, vol. 53(4), pages 447-475, April.
    2. Hansen, Michael W. & Pedersen, Torben & Petersen, Bent, 2009. "MNC strategies and linkage effects in developing countries," Journal of World Business, Elsevier, vol. 44(2), pages 121-130, April.
    3. Castellani, Davide & Pieri, Fabio, 2013. "R&D offshoring and the productivity growth of European regions," Research Policy, Elsevier, vol. 42(9), pages 1581-1594.
    4. Crescenzi, Riccardo & Gagliardi, Luisa & Iammarino, Simona, 2015. "Foreign multinationals and domestic innovation: Intra-industry effects and firm heterogeneity," Research Policy, Elsevier, vol. 44(3), pages 596-609.
    5. repec:eee:iburev:v:26:y:2017:i:3:p:405-416 is not listed on IDEAS
    6. repec:eee:respol:v:47:y:2018:i:2:p:474-486 is not listed on IDEAS
    7. Carlo Pietrobelli & Federica Saliola, 2007. "Power Relationships along the Value Chain: Multinational Firms, Global Buyers, and Local Suppliers' Performance," Working Papers 0702, CREI Università degli Studi Roma Tre, revised Jan 2007.
    8. Grazia Ietto-Gillies, 2012. "The Multinational Firm: Characteristics, Activities and Explanations in Historical Context," Chapters,in: Handbook on the Economics and Theory of the Firm, chapter 14 Edward Elgar Publishing.
    9. Chen, Tain-Jy, 2006. "Liability of foreignness and entry mode choice: Taiwanese firms in Europe," Journal of Business Research, Elsevier, vol. 59(2), pages 288-294, February.
    10. Erol Taymaz & Aykut Lenger, 2004. "Multinational Corporations as a Vehicle for Productivity Spillovers in Turkey," DRUID Working Papers 04-09, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    11. Simona Iammarino & Philip McCann, 2010. "The Relationship between Multinational Firms and Innovative Clusters," Chapters,in: The Handbook of Evolutionary Economic Geography, chapter 8 Edward Elgar Publishing.
    12. Dachs, Bernhard, 2017. "Internationalisation of R&D: A Review of Drivers, Impacts, and new Lines of Research," MPRA Paper 83367, University Library of Munich, Germany.
    13. Castellani, Davide & Montresor, Sandro & Schubert, Torben & Vezzani, Antonio, 2017. "Multinationality, R&D and productivity: Evidence from the top R&D investors worldwide," International Business Review, Elsevier, vol. 26(3), pages 405-416.
    14. Anna Giunta, 2002. "Large Firms and Southern Italy: The Relevance of Salvatore Cafiero’s Position," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 2, June.
    15. Grazia Ietto-Gillies, 2011. "The Integration and Fragmentation Roles of Transnational Companies," Chapters,in: International Handbook on the Economics of Integration, Volume III, chapter 3 Edward Elgar Publishing.
    16. Francesco Di Comite & d’Artis Kancs, 2015. "Macro-Economic Models for R&D and Innovation Policies," JRC Working Papers on Corporate R&D and Innovation 2015-03, Joint Research Centre (Seville site).

    More about this item

    JEL classification:

    • 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
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development


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