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The influence of international dispersed vs. home-based R&D on innovation performance

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  • Peters, Bettina
  • Schmiele, Anja

Abstract

Recent years have shown a surge of firms globalising their innovation activities in order to gain from international knowledge. This paper evaluates this strategy by investigating whether firms with international R&D are more innovative than firms doing R&D only in their home country. One main novelty is that we shed light on two competing hypotheses whether stronger dispersed international R&D activities hamper or stimulate innovation. Second, we employ two well-established market-based indicators for innovation (introduction of and sales growth rates due to new products) instead of looking at inventions (patents). Using German CIS data for about 2100 firms, the econometric results show that firms with international R&D are more likely to launch new products (firm and market novelties) than firms with home-based R&D only. They are also more successful in terms of higher sales growth with firm novelties. However, given the introduction of a market novelty, the location of R&D doesn't matter for the sales growth with market novelties. The results concerning the degree of R&D internationalisation are mixed: The likelihood of introducing firm novelties increases with a stronger dispersion of foreign R&D activities (for market novelties only up to a specific point). The relationship between degree of R&D internationalisation and innovation success turns out to be inverse u-shaped.

Suggested Citation

  • Peters, Bettina & Schmiele, Anja, 2010. "The influence of international dispersed vs. home-based R&D on innovation performance," ZEW Discussion Papers 10-102, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:10102
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    References listed on IDEAS

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    1. Crepon, B. & Duguet, E. & Mairesse, J., 1998. "Research Investment, Innovation and Productivity: An Econometric Analysis at the Firm Level," Papiers d'Economie Mathématique et Applications 98.15, Université Panthéon-Sorbonne (Paris 1).
    2. von Zedtwitz, Maximilian & Gassmann, Oliver & Boutellier, Roman, 2004. "Organizing global R&D: challenges and dilemmas," Journal of International Management, Elsevier, vol. 10(1), pages 21-49.
    3. Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
    4. Ingmar Björkman & Wilhelm Barner-Rasmussen & Li Li, 2004. "Managing knowledge transfer in MNCs: the impact of headquarters control mechanisms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 35(5), pages 443-455, September.
    5. 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.
    6. Joan Penner‐Hahn & J. Myles Shaver, 2005. "Does international research and development increase patent output? An analysis of Japanese pharmaceutical firms," Strategic Management Journal, Wiley Blackwell, vol. 26(2), pages 121-140, February.
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    Cited by:

    1. Thomas Niebel & Fabienne Rasel & Steffen Viete, 2019. "BIG data – BIG gains? Understanding the link between big data analytics and innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 28(3), pages 296-316, April.
    2. Hollenstein, Heinz & Berger, Martin, 2015. "Choice of foreign R&D entry mode and its relation to firm performance: A firm-level analysis for Switzerland and Austria," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 9, pages 1-47.
    3. Niebel, Thomas & Rasel, Fabienne & Viete, Steffen, 2017. "BIG data - BIG gains? Empirical evidence on the link between big data analytics and innovation," ZEW Discussion Papers 17-053, ZEW - Leibniz Centre for European Economic Research.
    4. Martin Berger & Heinz Hollenstein, 2012. "Determinants of equity-based and co-operative foreign R&D and impact on the parent firm's performance," KOF Working papers 12-305, KOF Swiss Economic Institute, ETH Zurich.

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    More about this item

    Keywords

    R&D; Internationalisation; Innovation performance; Decentralisation;
    All these keywords.

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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