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The Innovativeness of Foreign Firms in China

Author

Listed:
  • Urem, Branka

    (UNU-MERIT)

  • Alcorta, Ludovico

    (Maastricht School of Management)

  • An, Tongliang

    (School of Business, Nanjing University)

Abstract

This paper studies the relationship between foreign ownership and innovations of high novelty in context of advanced developing countries. We develop hypotheses about a direct relationship in terms of two dimensions, propensity and intensity of innovations of high novelty, and a contingency hypothesis about the moderating impact of R&D internationalisation on the relationship with propensity. The analysis is based on innovation survey data on manufacturing firms from Jiangsu province of China. Hypotheses are tested using non-parametric methods. We find that foreign firms do not have a higher propensity of innovations of high novelty, not even when they engage in formal R&D. However, the evidence suggests that foreign firms have a higher intensity of innovations of high novelty than domestic firms.

Suggested Citation

  • Urem, Branka & Alcorta, Ludovico & An, Tongliang, 2008. "The Innovativeness of Foreign Firms in China," MERIT Working Papers 2008-019, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    • Handle: RePEc:unm:unumer:2008019
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    File URL: https://www.merit.unu.edu/publications/wppdf/2008/wp2008-019.pdf
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    References listed on IDEAS

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    1. (Robert) Li, Xiang & Harrill, Rich & Uysal, Muzaffer & Burnett, Traverse & Zhan, Xiaofeng, 2010. "Estimating the size of the Chinese outbound travel market: A demand-side approach," Tourism Management, Elsevier, vol. 31(2), pages 250-259.
    2. Jaan Masso & Tõnu Roolaht & Urmas Varblane, 2010. "Foreign Direct Investment And Innovation In Central And Eastern Europe: Evidence From Estonia," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 67, Faculty of Economics and Business Administration, University of Tartu (Estonia).

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    More about this item

    Keywords

    multinational enterprises; foreign firms; innovation; manufacturing; China;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • 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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