Strategic R&D Location by Multinational Firms: Spillovers, Technology Sourcing and Competition
We analyse strategic interaction in R&D internationalization decisions by two multinational firms competing both abroad and in their home markets and examine different incentives for foreign R&D faced by technology leaders and technology laggards. The model takes into account the impact of local inter-firm R&D spillovers, (non-costless) international intra-firm transfer of knowledge, and the notion that internal R&D increases the effectiveness of incoming spillovers. Greater efficiency of intra-firm transfers and greater spillovers increases the attractiveness of home R&D to the technology leader. The lagging firm in contrast increases the share of foreign R&D as overseas technology sourcing becomes more effective. Greater product market competition encourages the leading firm to engage in foreign R&D to capture a larger share of profits on the foreign market, while laggards concentrate more R&D at home to defend their home market position. The country with a stricter intellectual property rights regime attracts a larger share of R&D by both leader and laggard.
|Date of creation:||May 2005|
|Date of revision:|
|Contact details of provider:|| Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.|
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
|Order Information:|| Email: |
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.:
- Cadot, Olivier & Desruelle, Dominique, 1998.
"R&D: Who does the R, who does the D?,"
Journal of International Economics,
Elsevier, vol. 46(1), pages 87-103, October.
- Desruelle, D. & Cadot, O., 1992. "R&D : Woh Does the R , Who Does the D," Cahiers de recherche 9230, Universite de Montreal, Departement de sciences economiques.
- Desruelle, D. & Cadot, O., 1992. "R&D : Woh Does the R , Who Does the D," Cahiers de recherche 9230, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- Walter Kuemmerle, 1999. "The Drivers of Foreign Direct Investment into Research and Development: An Empirical Investigation," Journal of International Business Studies, Palgrave Macmillan, vol. 30(1), pages 1-24, March.
- Bruno Cassiman & David Pérez Castrillo & Reinhilde Veugelers, 2000.
"Endogeneizing know-how flows through the nature of R&D investments,"
Economics Working Papers
512, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2001.
- Cassiman, Bruno & Perez-Castrillo, David & Veugelers, Reinhilde, 2002. "Endogenizing know-how flows through the nature of R&D investments," International Journal of Industrial Organization, Elsevier, vol. 20(6), pages 775-799, June.
- Cassiman, Bruno & Pérez-Castrillo, J David & Veugelers, Reinhilde, 2000. "Endogenizing Know-How Flows Through the Nature of R&D Investments," CEPR Discussion Papers 2622, C.E.P.R. Discussion Papers.
- Cassiman, Bruno & Pérez-Castrillo, David, 2000. "Endogenizing know-how flows through the nature of R&D investments," IESE Research Papers D/428, IESE Business School.
- David Pérez-Castrillo & Bruno Cassiman & Reinhilde Veugelers, 2000. "Endogeneizing know-how flows through the nature of R&D investments," UFAE and IAE Working Papers 464.00, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Bjorvatn, K. & Eckel, C., 2001.
"Technology Sourcing and Strategic Foreign Direct Investment,"
28/2001, Norwegian School of Economics and Business Administration-.
- Kjetil Bjorvatn & Carsten Eckel, 2006. "Technology Sourcing and Strategic Foreign Direct Investment," Review of International Economics, Wiley Blackwell, vol. 14(4), pages 600-614, 09.
- Bjorvatn, Kjetil & Eckel, Carsten, 2006. "Technology sourcing and strategic foreign direct investment," Munich Reprints in Economics 20269, University of Munich, Department of Economics.
- Sanna-Randaccio, Francesca & Veugelers, Reinhilde, 2002. "Multinational Knowledge Spillovers with Centralized versus Decentralized R&D: A Game Theoretic Approach," CEPR Discussion Papers 3151, C.E.P.R. Discussion Papers.
- Leahy, Dermot & Neary, J. Peter, 2007.
"Absorptive capacity, R&D spillovers, and public policy,"
International Journal of Industrial Organization,
Elsevier, vol. 25(5), pages 1089-1108, October.
- Leahy, Dermot & Neary, J Peter, 2004. "Absorptive Capacity, R&D Spillovers and Public Policy," CEPR Discussion Papers 4171, C.E.P.R. Discussion Papers.
- Dermot Leahy & J. Peter Neary, 2004. "Absorptive capacity, R&D spillovers, and public policy," Working Papers 200418, School of Economics, University College Dublin.
- Cohen, Wesley M & Levinthal, Daniel A, 1989. "Innovation and Learning: The Two Faces of R&D," Economic Journal, Royal Economic Society, vol. 99(397), pages 569-96, September.
- Bas, Christian Le & Sierra, Christophe, 2002. "'Location versus home country advantages' in R&D activities: some further results on multinationals' locational strategies," Research Policy, Elsevier, vol. 31(4), pages 589-609, May.
- Luís M. B. Cabral, 2003. "R&D Competition when firms Choose Variance," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 12(1), pages 139-150, 03.
- Belderbos, Rene, 2001. "Overseas innovations by Japanese firms: an analysis of patent and subsidiary data," Research Policy, Elsevier, vol. 30(2), pages 313-332, February.
- Lee Branstetter, 2000. "Is Foreign Direct Investment a Channel of Knowledge Spillovers? Evidence from Japan's FDI in the United States," NBER Working Papers 8015, National Bureau of Economic Research, Inc.
- Kumar, Nagesh, 1995.
"Intellectual Property Protection, Market Orientation and Location of Overseas R&D Activities by Multinational Enterprises,"
UNU-INTECH Discussion Paper Series
01, United Nations University - INTECH.
- Kumar, Nagesh, 1996. "Intellectual property protection, market orientation and location of overseas R&D activities by multinational enterprises," World Development, Elsevier, vol. 24(4), pages 673-688, April.
- Georges SIOTIS, 1996.
"Foreign Direct Investment Strategies and Firms' Capabilities,"
Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP)
9626, Université de Lausanne, Faculté des HEC, DEEP.
- Georges Siotis, 1999. "Foreign Direct Investment Strategies and Firms' Capabilities," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 8(2), pages 251-270, 06.
- Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, vol. 86(3), pages 630-40, June.
- Odagiri, Hiroyuki & Yasuda, Hideto, 1996. "The determinants of overseas R&D by Japanese firms: an empirical study at the industry and company levels," Research Policy, Elsevier, vol. 25(7), pages 1059-1079, October.
When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:5060. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()The email address of this maintainer does not seem to be valid anymore. Please ask to update the entry or send us the correct email address
If references are entirely missing, you can add them using this form.