Local cooperation for innovation in ICT—Domestic groups with collaborations for innovation abroad and foreign subsidiaries

On analysing a sample of Information and Communication Technology (ICT) firms, we ask whether domestic business groups that are engaged in international cooperation for innovation are likely to cooperate for innovation in the home market. We compare these companies with other types of ICT firms. The idea behind our inquiry is that domestic groups involved in international cooperation for innovation are exposed to international information, while they are also well embedded in the home economy. We find that these companies as well as foreign subsidiaries are more prone to cooperating for innovation with domestic partners than are other types of ICT companies, even when size and other characteristics of firms that may influence cooperation are taken into consideration. However, domestic groups with international cooperation for innovation show a systematically higher propensity than foreign subsidiaries to cooperate with domestic partners. These results may be useful regarding policies of foreign direct investment promotion and their alternatives.