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The Innovativeness of Foreign Firms in China

  • Urem, Branka

    ()

    (UNU-MERIT)

  • Alcorta, Ludovico

    ()

    (Maastricht School of Management)

  • An, Tongliang

    ()

    (School of Business, Nanjing University)

Registered author(s):

    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.

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    File URL: http://www.merit.unu.edu/publications/wppdf/2008/wp2008-019.pdf
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    Paper provided by United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT) in its series MERIT Working Papers with number 019.

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    Date of creation: 2008
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    Handle: RePEc:unm:unumer:2008019
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    1. Hirschey, Robert C & Caves, Richard E, 1981. "Research and Transfer of Technology by Multinational Enterprises," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 43(2), pages 115-30, May.
    2. Bruce Kogut & Udo Zander, 1993. "Knowledge of the Firm and the Evolutionary Theory of the Multinational Corporation," Journal of International Business Studies, Palgrave Macmillan, vol. 24(4), pages 625-645, December.
    3. Kannebley, Sergio Jr. & Porto, Geciane S. & Pazello, Elaine Toldo, 2005. "Characteristics of Brazilian innovative firms: An empirical analysis based on PINTEC--industrial research on technological innovation," Research Policy, Elsevier, vol. 34(6), pages 872-893, August.
    4. Pierre Mohnen & Pierre Therrien, 2001. "How Innovative Are Canadian Firms Compared to Some European Firms? A Comparative Look at Innovation Surveys," CIRANO Working Papers 2001s-49, CIRANO.
    5. Dachs, Bernhard & Ebersberger, Bernd & Lööf, Hans, 2007. "The Innovative Performance of Foreign-owned Enterprises in Small Open Economies," Working Paper Series in Economics and Institutions of Innovation 87, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    6. Walter Kuemmerle, 1999. "The Drivers of Foreign Direct Investment into Research and Development: An Empirical Investigation," Journal of International Business Studies, Palgrave Macmillan, vol. 30(1), pages 1-24, March.
    7. John H Dunning, 1988. "The Eclectic Paradigm of International Production: A Restatement and Some Possible Extensions," Journal of International Business Studies, Palgrave Macmillan, vol. 19(1), pages 1-31, March.
    8. Marion Frenz & Grazia Ietto-Gillies, 2007. "Does Multinationality Affect the Propensity to Innovate? An Analysis of the Third UK Community Innovation Survey," International Review of Applied Economics, Taylor & Francis Journals, vol. 21(1), pages 99-117.
    9. Archibugi, Daniele & Michie, Jonathan, 1995. "The Globalisation of Technology: A New Taxonomy," Cambridge Journal of Economics, Oxford University Press, vol. 19(1), pages 121-40, February.
    10. Lundin, Nannan & Sjöholm, Fredrik & Ping, He & Qian, Jinchang, 2007. "The Role of Small Firms in China's Technology Development," Working Paper Series 695, Research Institute of Industrial Economics.
    11. Luo, Yadong, 2002. "Partnering with foreign businesses: perspectives from Chinese firms," Journal of Business Research, Elsevier, vol. 55(6), pages 481-493, June.
    12. Cantwell, John & Santangelo, Grazia D., 1999. "The frontier of international technology networks: sourcing abroad the most highly tacit capabilities," Information Economics and Policy, Elsevier, vol. 11(1), pages 101-123, March.
    13. Kuemmerle, Walter, 1999. "Foreign direct investment in industrial research in the pharmaceutical and electronics industries--results from a survey of multinational firms," Research Policy, Elsevier, vol. 28(2-3), pages 179-193, March.
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