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Determinants of MNE Subsidiaries Decisions to Set Up Own R&D Laboratories - Theory and Evidence

  • Kottaridi, Constantina
  • Papanastassiou, Marina
  • Pitelis, Christos

We explore the determinants of MNE subsidiaries decisions to set-up own R&D laboratories drawing on evidence from UK regions. In this context, we also test for the interaction between firm's internal and external environments. We also integrate extant IB and strategic management literatures and incorporate recent debates in New Economic Geography (NEG) in specifying the 'external environment'. We find support for the role of firm's 'productive opportunity' and predictions of the NEG on the basis of an analysis of primary data. We discuss implications for managerial practice and government regional policies.

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Paper provided by Economic and Social Research Institute (ESRI) in its series Papers with number DYNREG38.

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Length: 33 pages
Date of creation: 2009
Date of revision:
Handle: RePEc:esr:wpaper:dynreg38
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  1. 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.
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  8. Ram Mudambi & Pietro Navarra, 2004. "Is knowledge power? Knowledge flows, subsidiary power and rent-seeking within MNCs," Journal of International Business Studies, Palgrave Macmillan, vol. 35(5), pages 385-406, September.
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  12. Maria Savona & Giulio Cainelli & Rinaldo Evangelista, 2006. "Innovation and economic performance in services. A firm level analysis," Post-Print halshs-00231578, HAL.
  13. Markusen, James R. & Venables, Anthony J., 1998. "Multinational firms and the new trade theory," Journal of International Economics, Elsevier, vol. 46(2), pages 183-203, December.
  14. G R G Benito & B Gr√łgaard & R Narula, 2003. "Environmental influences on MNE subsidiary roles: economic integration and the Nordic countries," Journal of International Business Studies, Palgrave Macmillan, vol. 34(5), pages 443-456, September.
  15. Venables, Anthony J., 1999. "Fragmentation and multinational production," European Economic Review, Elsevier, vol. 43(4-6), pages 935-945, April.
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  17. Veugelers, Reinhilde, 1997. "Internal R & D expenditures and external technology sourcing," Research Policy, Elsevier, vol. 26(3), pages 303-315, October.
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