Multinationals and the Globalization of R&D

María García-Vega, Patricia Hofmann and Richard Kneller

No 2015-18, Discussion Papers from University of Nottingham, GEP

Abstract: We consider theoretically and empirically how the location and organization of knowledge production evolve within domestic firms during the period of their acquisition by foreign multinationals. Acquisitions do not increase the risk of closure of the subsidiary’s research labs unless acquired by MNEs at the technological frontier. Conditional on keeping research in the subsidiary, there is a large decrease of innovation expenditures, transfer of knowledge and reorganization towards high-skilled workers. We show that innovations increase, which is a consequence of the complementarity between foreign technology transfers and skilled-workers in the subsidiary.

Keywords: MNE; Knowledge Production Function; Acquisition FDI; Knowledge Complementarities; R&D innovation. (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-cse, nep-ind and nep-ino
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Journal Article: Multinationals and the globalization of R&D (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:not:notgep:15/18

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