Multinationality, R&D and productivity: Evidence from the top R&D investors worldwide

Davide Castellani, Sandro Montresor (), Torben Schubert and Antonio Vezzani ()

John H Dunning Centre for International Business Discussion Papers from Henley Business School, University of Reading

Abstract: This paper investigates the effects of multinationality on firm productivity, and contributes to the literature in two respects. First, we argue that multinationality affects productivity both directly and indirectly, through higher incentives to invest in R&D. Second, we maintain that the multinational depth and breadth have different direct effects on productivity and R&D. Using data from the top R&D investors in the world, we propose an econometric model with an R&D and a productivity equation that both depend on multinationality. We find: i) multinational depth has a positive effect on productivity, while the effect of multinational breadth is negative; ii) multinationality (along both dimensions) has a positive effect on R&D intensity, translating into an indirect positive effect on productivity; iii) the positive indirect effect is however not large enough to compensate the negative direct effect of multinational breadth.

Keywords: Multinationality; R&D; productivity (search for similar items in EconPapers)
JEL-codes: F23 F61 O32 (search for similar items in EconPapers)
Date: 2016-06
New Economics Papers: this item is included in nep-cse, nep-eff and nep-ino
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Journal Article: Multinationality, R&D and productivity: Evidence from the top R&D investors worldwide (2017)
Working Paper: Multinationality, R&D and Productivity: Evidence from the top R&D investors worldwide (2016)
Working Paper: Multinationality, R&D and Productivity Evidence from the top R&D investors worldwide (2015)
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