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Multinational Enterprises, Spillovers, Innovation and Productivity

Author

Listed:
  • Ebersberger, Bernd

    (Technology Analysis & Innovation Strategies, Fraunhofer Institute for Systems and Innovation Research)

  • Lööf, Hans

    () (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)

Abstract

Recent debate has focused on the importance of corporate governance, localization of headquarters, foreign direct investments, externalities and key actors in national innovation systems and productivity. This study explores whether foreign-owned multinational firms differ systematically from domestic firms in terms of R&D-investments, transmission of technological knowledge and economic performance. The econometric analysis is based on a sample of 1 197 firm-level observations in Sweden, of which approximately a third from firms with foreign owners. The main finding is that domestic multinational firms are distinct from Nordic, Anglo-Saxon and European and other groups of corporate owners in terms of R&D investments and embeddedness in scientific, vertical and horizontal innovation systems. However, the advantage of higher R&D intensity and possible knowledge technological knowledge spillover does not manifest itself in superior innovation output or productivity performance. Our tentative explanation is that domestic multinationals are using the home country for developing technological capacity that is subsequently exploited in affiliates abroad. Correspondingly, the innovation and productivity performance in foreign multinationals are partly returns on activities created in their home countries

Suggested Citation

  • Ebersberger, Bernd & Lööf, Hans, 2004. "Multinational Enterprises, Spillovers, Innovation and Productivity," Working Paper Series in Economics and Institutions of Innovation 22, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  • Handle: RePEc:hhs:cesisp:0022
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    File URL: https://static.sys.kth.se/itm/wp/cesis/cesiswp22.pdf
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    References listed on IDEAS

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    1. Jonathan E. Haskel & Sonia C. Pereira & Matthew J. Slaughter, 2007. "Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 482-496, August.
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    Cited by:

    1. Martin Falk & Rahel Falk, 2006. "Do Foreign-Owned Firms Have a Lower Innovation Intensity Than Domestic Firms?," WIFO Working Papers 275, WIFO.
    2. Johansson, Börje & Lööf, Hans & Rader Olsson, Amy, 2005. "Firm Location, Corporate Structure, R&D Investment, Innovation and Productivity," Working Paper Series in Economics and Institutions of Innovation 31, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

    More about this item

    Keywords

    Multinational Enterprises; Spillovers; R&D; Innovation; Productivity;

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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