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Complementarity between in-house R&D and technology purchasing: evidence from Chinese manufacturing firms

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  • Hou, Jun

    (UNU-MERIT)

  • Mohnen, Pierre

    (UNU-MERIT, Maastricht University)

Abstract

In order to catch up with the technological frontier, firms, especially in developing countries, try to acquire technological advancement through internal R&D efforts as well as through external technology sourcing activities. This study tests the existence of a complementarity between in-house R&D and external technology acquisition in Chinese manufacturing firms. We show that the two sources of technological upgrading are complementary in stimulating product innovation across small and medium size manufacturing firms in China, but not in generating process innovation nor in achieving higher levels of labor productivity.

Suggested Citation

  • Hou, Jun & Mohnen, Pierre, 2011. "Complementarity between in-house R&D and technology purchasing: evidence from Chinese manufacturing firms," MERIT Working Papers 2011-048, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    • Handle: RePEc:unm:unumer:2011048
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    References listed on IDEAS

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    Cited by:

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    2. Mariana Spatareanu, 2023. "Acquiring Innovation - Do Chinese acquisitions in developed countries spur innovation at home?," Working Papers Rutgers University, Newark 2023-002, Department of Economics, Rutgers University, Newark.
    3. Dürr, Niklas S. & Rammer, Christian & Böing, Philipp, 2020. "Direktinvestitionen zwischen Deutschland und China aus einer innovationspolitischen Sicht: Studie im Auftrag der Expertenkommission Forschung und Innovation," Studien zum deutschen Innovationssystem 8-2020, Expertenkommission Forschung und Innovation (EFI) - Commission of Experts for Research and Innovation, Berlin.
    4. Justin Doran & Geraldine Ryan, 2014. "Eco-Innovation – does additional engagement lead to additional rewards?," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 41(11), pages 1110-1130, November.
    5. Fu, Xiaolan & Hou, Jun & Liu, Xiaohui, 2018. "Unpacking the Relationship between Outward Direct Investment and Innovation Performance: Evidence from Chinese firms," World Development, Elsevier, vol. 102(C), pages 111-123.
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    7. Zuniga, Pluvia & Crespi, Gustavo, 2013. "Innovation strategies and employment in Latin American firms," Structural Change and Economic Dynamics, Elsevier, vol. 24(C), pages 1-17.
    8. Xiaolan Fu & Peter J. Buckley & Diego Sanchez-Ancochea & Ines Hassan, 2022. "The world has a unique opportunity: Accelerating technology transfer and vaccine production through partnerships," Journal of International Business Policy, Palgrave Macmillan, vol. 5(3), pages 406-415, September.
    9. Jianping Liu & Kai Lu & Shixiong Cheng, 2018. "International R&D Spillovers and Innovation Efficiency," Sustainability, MDPI, vol. 10(11), pages 1-23, October.
    10. Böing, Philipp & Müller, Elisabeth & Sandner, Philipp, 2013. "In-house R&D and External Knowledge Acquisition What Makes Chinese Firms Productive?," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 80037, Verein für Socialpolitik / German Economic Association.
    11. Hulya Ulku & Mehmet Pamukcu, 2015. "The impact of R&D and knowledge diffusion on the productivity of manufacturing firms in Turkey," Journal of Productivity Analysis, Springer, vol. 44(1), pages 79-95, August.
    12. Lin, Chia-Ling & Lin, Hui-Lin & Lin, Eric S., 2016. "Is There A Complementary Relationship Between Product And Process Innovation On Productivity In Taiwanese Manufacturing Firms?," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 57(2), pages 139-173, December.
    13. Carlos Bianchi & Hugo Laguna, 2020. "Firm’s innovation strategies and employment: new evidence from Uruguay," Documentos de Trabajo (working papers) 20-06, Instituto de Economía - IECON.
    14. Uluc Aysun & Zeynep Yom, 2019. "R&D, innovation spillover and business cycles," Villanova School of Business Department of Economics and Statistics Working Paper Series 43, Villanova School of Business Department of Economics and Statistics.
    15. Doran, Justin, 2012. "Are different forms of innovation complements or substitutes?," MPRA Paper 44580, University Library of Munich, Germany.
    16. Ronald B. Davies, 2018. "From China with Love: The Role of FDI from Third Countries on EU Competition and R&D Activities," Working Papers 201813, School of Economics, University College Dublin.
    17. Panda, Sidheswar & Sharma, Ruchi, 2021. "Do changes in patent policy influence firms’ technology strategy? Evidence from manufacturing in India," Journal of Policy Modeling, Elsevier, vol. 43(2), pages 362-375.

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    More about this item

    Keywords

    R&D; technology purchasing; complementarity; China; manufacturing;
    All these keywords.

    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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