Foreign Research and Development and Host Country Environment: An Empirical Examination of U.S. International R&Amp;D

Zusammenfassung

---

Multinational corporations (MNCs) are continuing to internationalize their research and development (R&D) activities. Some country environments are more conducive to such investments than others. In this study, we evaluate the influence of host country factors on foreign R&D investment. Using the just-released US government 1999 benchmark survey of US MNC activities abroad, and country-level data compiled from a variety of sources, we measure the impact of host country economic, institutional, scientific, and telecommunications infrastructure on US MNC foreign R&D activities.

Siehe den Gesamtinhalt dieses Dokumentes

Auszug

---

Foreign Research and Development and Host Country Environment: An Empirical Examination of U.S. International R&Amp;D

The internationalization of the research and development (R&D) function of the firm is now well established. Historically, the R&D function was typically held close to the center of the firm's operations. More recently, there is growing evidence that firms are moving to a more dispersed approach to their innovative capacity, and increasingly are establishing R&D operations in foreign locations. While not yet a universal phenomenon, and still found predominantly in larger firms from industrialized countries (Patel 1996), many researchers contend that R&D activities of MNCs will increasingly be globally distributed, as opposed to centralized in one country (Cantwell 1989, 1992, Cantwell/Janne 1999, Casson/ Singh 1993, Dunning/Narula 1995, Granstrand 1999, Granstand/Hakanson/Sjolander 1992, Hâkanson 1992, Niosi 1999, Pearce 1989, Pearce/Singh 1992).

The location of these activities is of increasing importance to MNCs as they seek to acquire, protect, and leverage innovative capacity abroad, and to host countries seeking to attract R&D investment and benefit from associated economic spillovers. In addition to economic factors, institutional considerations and appropriability regimes, including the quality of the political environment, the extent of corruption, and overall economic and political risk, likely influence firm decisions about where to locate R&D and how much to invest in those locations. Similarly, scientific capability and telecommunications infrastructure would also appear to be important to R&D investors. Finally, the activities of other MNCs in the market, and the overall presence of MNC investment, might also stimulate activities by other foreign competitors. Using the recently released US government 1999 benchmark survey of US MNC activities abroad, and country-level data compiled from a variety of governmental and non-governmental sources, we measure the impact of economic, institutional, scientific, telecommunications, and MNC competitive factors on US MNC foreign R&D activities. Our study addresses questions of interest to managers and host country policy makers because each has a stake in how these factors affect firms' R&D location and investment decisions.

While research focused on the identification of foreign R&D determinants has been addressed in a number of venues, because of wide variation in methods, model specification, data selection, level of analysis, and construct operationalization, results have been somewhat inconsistent and often equivocal. The current study complements and extends the literature in several ways. Consistent with earlier work in the literature (Papanastassiou 1997a, 1997b, Jones/Teegen 2003), we utilize aggregate macro-level country-specific data, but we incorporate more recently available data (1999 as opposed to 1982 and 1994, respectively). In addition, we focus on ins...

Siehe den Gesamtinhalt dieses Dokumentes

---