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Globalization of R&D and China – Empirical Observations and Policy Implications


  • Lundin, Nannan

    () (Research Institute of Industrial Economics (IFN))

  • Schwaag Serger, Sylvia

    () (ITPS)


As one of the world’s largest recipients of Foreign Direct Investment (FDI), China is emerging as a key global player in Research and Development (R&D). This rapid increase in R&D investment is mainly attributed to the effort of strengthening the indigenous innovation capacity of domestic actors and, to an increasing extent, to the process of globalization of R&D with multinational enterprises as key driving force. This paper provides a detailed overview of the relative importance of foreign R&D in China based on quantitative mapping in terms of R&D inputs, outputs and local linkages in R&D-related activities, combined with an in-depth description of the nature of foreign R&D activities. Our empirical observation suggests that the growing importance of China in the globalization of R&D is more than a ‘flash-in-the-pan’. On one hand, China is facing new challenges, but at the same time is attempting to seize the “window of opportunity” to compete for knowledge and human resources through structural adjustments and new policy initiatives. On the other hand, multinational enterprises from OECD countries are not only intensifying, but also diversifying their activities in a larger number of R&D intensive sectors in China. In such a rapid and dynamic development, China seems to emerge not only as an important source of R&D but also a key magnet of global R&D operations.

Suggested Citation

  • Lundin, Nannan & Schwaag Serger, Sylvia, 2007. "Globalization of R&D and China – Empirical Observations and Policy Implications," Working Paper Series 710, Research Institute of Industrial Economics.
  • Handle: RePEc:hhs:iuiwop:0710

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    References listed on IDEAS

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    Cited by:

    1. Khan, Haider, 2013. "Industrialization and Development Strategies in the 21st Century: Towards Sustainable Innovation Systems," MPRA Paper 50168, University Library of Munich, Germany.
    2. Virginie JACQUIER-ROUX & Christian LE BAS, 2008. "Localisation Des Activités De R&D Des Firmes Multinationales, Modes D’Organisation En Réseaux Et Transfert Transnational Des Connaissances : Un Cadre D’Analyse," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 28, pages 11-38.
    3. Riccardo Crescenzi & Andrés Rodríguez-Pose, 2012. "An ‘Integrated’ Framework For The Comparative Analysis Of The Territorial Innovation Dynamics Of Developed And Emerging Countries," Journal of Economic Surveys, Wiley Blackwell, vol. 26(3), pages 517-533, July.
    4. Abdelillah Hamdouch & Feng He, 2009. "R&D offshoring and clustering dynamics in pharmaceuticals and biotechnology: key features and insights from the Chinese case," Journal of Innovation Economics, De Boeck Université, vol. 0(2), pages 95-117.

    More about this item


    China; R&D; Globalization; Multinationals;

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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