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The effects of production offshoring on R&D and innovation in the home country

  • Dachs, Bernhard
  • Ebersberger, Bernd
  • Kinkel, Steffen
  • Som, Oliver

We investigate the effects of production offshoring on the innovation activities of manufacturing firms in the home country. The analysis is based on a dataset of more than 3000 manufacturing firms from seven European countries. We find that offshoring firms on average employ a higher share of R&D and design personnel, introduce new products more frequently to the market, and invest more frequently in advanced process technologies compared to non-offshoring firms. Concerns that offshoring may hurt innovation because of the lost links between production and product development are not supported by the evidence.

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Paper provided by Fraunhofer Institute for Systems and Innovation Research (ISI) in its series Discussion Papers "Innovation Systems and Policy Analysis" with number 39.

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Date of creation: 2014
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Handle: RePEc:zbw:fisidp:39
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