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Globalisation, industrial diversification and productivity growth in large European R&D companies

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Abstract

This paper aims to assess the impact of both geographic and industrial diversification of economic activities on the productivity performance of large European R&D Multinational Enterprises (MNEs). Based on the worldwide subsidiaries of these firms, we measure the performance of the firms according to their level of industrial diversification and globalisation that we proxy with the presence and importance of subsidiaries in the EU, North America and Asia-Pacific regions. The sample consists of large R&D firms that represent about 80% of total European R&D. In general, the results indicate a positive impact from globalisation on firms’ R&D productivity, especially in the US, while a negative impact for industrial diversification is found.

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  • Michele Cincera & Julien Ravet, 2011. "Globalisation, industrial diversification and productivity growth in large European R&D companies," JRC Working Papers on Corporate R&D and Innovation 2011-01, Joint Research Centre (Seville site).
  • Handle: RePEc:ipt:wpaper:201101
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    References listed on IDEAS

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    1. Alfred D. Chandler, 1969. "Strategy and Structure: Chapters in the History of the American Industrial Enterprise," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262530090, January.
    2. Zvi Griliches, 1998. "Issues in Assessing the Contribution of Research and Development to Productivity Growth," NBER Chapters,in: R&D and Productivity: The Econometric Evidence, pages 17-45 National Bureau of Economic Research, Inc.
    3. von Zedtwitz, Maximilian & Gassmann, Oliver, 2002. "Market versus technology drive in R&D internationalization: four different patterns of managing research and development," Research Policy, Elsevier, vol. 31(4), pages 569-588, May.
    4. Henri Capron & Michele Cincera, 1998. "Assessing the R&D determinants and productivity of world-wide manufacturing firms," ULB Institutional Repository 2013/849, ULB -- Universite Libre de Bruxelles.
    5. Meyer, Margaret & Milgrom, Paul & Roberts, John, 1992. "Organizational Prospects, Influence Costs, and Ownership Changes," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 1(1), pages 9-35, Spring.
    6. Michele Cincera & Claudio Cozza & Alexander Tübke, 2010. "Drivers and policies for increasing and internationalising R&D activities of EU MNEs," JRC Working Papers on Corporate R&D and Innovation 2010-02, Joint Research Centre (Seville site).
    7. Kamien,Morton I. & Schwartz,Nancy L., 1982. "Market Structure and Innovation," Cambridge Books, Cambridge University Press, number 9780521293853, May.
    8. David J. Denis & Diane K. Denis & Keven Yost, 2002. "Global Diversification, Industrial Diversification, and Firm Value," Journal of Finance, American Finance Association, vol. 57(5), pages 1951-1979, October.
    9. Raquel Ortega-Argilés & Lesley Potters & Marco Vivarelli, 2011. "R&D and productivity: testing sectoral peculiarities using micro data," Empirical Economics, Springer, vol. 41(3), pages 817-839, December.
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    Cited by:

    1. Pietro Moncada-Paterno-Castello & Peter Voigt & Marco Vivarelli, 2011. "Evolution of Globalised business R&D: Features, drivers, impacts," JRC Working Papers on Corporate R&D and Innovation 2011-02, Joint Research Centre (Seville site).
    2. Michele Cincera & Claudio Cozza & Alexander Tübke, 2014. "Main drivers for local and global R&D sourcing of European Multinational Enterprises," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 4(2), pages 227-245, December.
    3. Michele Cincera & Julien Ravet & Reinhilde Veugelers, 2014. "R&D Financing Constraints of Young and Old Innovation Leaders in the EU and the US," iCite Working Papers 2014-008, ULB -- Universite Libre de Bruxelles.

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    Keywords

    R&D; European MNEs; productivity; globalisation; industrial diversification;

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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