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Does Excellence in Academic Research Attract Foreign R&D?

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  • Rene Belderbos
  • Bart Leten
  • Shinya Suzuki

Abstract

We examine the role of host countries' academic research strengths in global R&D location decisions by multinational firms. While we expect that a firm's propensity to perform R&D in a host country increases with the strength of local academic research, firms are expected to be heterogeneously positioned to benefit from academic research strengths due to differences in the capacity to absorb and utilize scientific knowledge. We find support for these conjectures in an analysis of foreign R&D activities in 40 host countries and 30 technology fields by 176 leading European, US and Japanese firms during the periods 1995-1998 and 1999-2002. Controlling for a wide range of host country factors, the number of relevant ISI publications by scientists based in the host country has a substantial positive impact on the propensity to conduct foreign R&D. The effect of academic research is significantly larger for firms with a stronger science orientation in R&D - as indicated by citations to scientific literature in prior patents. For host countries with a strong relevant science base, this greater responsiveness of science oriented firms more than offsets a generally greater inclination to concentrate R&D at home. The findings appear robust across a variety of specifications.

Suggested Citation

  • Rene Belderbos & Bart Leten & Shinya Suzuki, 2009. "Does Excellence in Academic Research Attract Foreign R&D?," Global COE Hi-Stat Discussion Paper Series gd09-079, Institute of Economic Research, Hitotsubashi University.
  • Handle: RePEc:hst:ghsdps:gd09-079
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    6. Vojtěch Kadlec & Viktor Květoň & Jana Vlčková & Jiří Blažek & Petr Horák, 2023. "Contrasting patterns and dynamics of patent offshoring in European regions," The Journal of Technology Transfer, Springer, vol. 48(4), pages 1300-1326, August.
    7. Nguyen, Quang & Kim, Huong Trang, 2023. "An exploration on policy uncertainty as a driver of R&D activity," Research in International Business and Finance, Elsevier, vol. 64(C).
    8. Laura Abramovsky, 2015. "Global engagement in R&D: a portrait of biopharmaceutical patenting firms," IFS Working Papers W15/18, Institute for Fiscal Studies.
    9. Sandra Leitner & Bernhard Dachs & Robert Stehrer, 2012. "Determinants of R&D activities of multinational firms abroad," ERSA conference papers ersa12p196, European Regional Science Association.
    10. Bernhard Dachs, 2014. "R&D Internationalisation and the Global Financial Crisis," Chapters, in: Bernhard Dachs & Robert Stehrer & Georg Zahradnik (ed.), The Internationalisation of Business R&D, chapter 13, pages 1-3, Edward Elgar Publishing.
    11. Stefano Bresciani & Alberto Ferraris & Manlio Del Giudice, 2016. "R&D internationalization in asian developing countries: evidence from european multinationals," MERCATI & COMPETITIVIT?, FrancoAngeli Editore, vol. 2016(3), pages 25-44.
    12. Grigori Feiguine & Julia Solovjova, 2014. "ICT Modernization and Globalization: Russian Perspectives," EIIW Discussion paper disbei199, Universitätsbibliothek Wuppertal, University Library.
    13. Martin Falk, 2013. "New Empirical Findings for International Investment in Intangible Assets. WWWforEurope Working Paper No. 30," WIFO Studies, WIFO, number 46891, Juni.
    14. Dachs, Bernhard, 2017. "Internationalisation of R&D: A Review of Drivers, Impacts, and new Lines of Research," MPRA Paper 83367, University Library of Munich, Germany.
    15. Bart Leten & Paolo Landoni & Bart Van Looy, 2011. "Developing Technology in the Vicinity of Science: Do Firms Benefit? An Overview and Empirical Assessment on the Level of Italian Provinces," Chapters, in: Massimo G. Colombo & Luca Grilli & Lucia Piscitello & Cristina Rossi-Lamastra (ed.), Science and Innovation Policy for the New Knowledge Economy, chapter 5, Edward Elgar Publishing.
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    More about this item

    Keywords

    R&D internationalization; Knowledge sourcing; Absorptive capacity; Industry-science links;
    All these keywords.

    JEL classification:

    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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