Globalization of R&D by U.S-based Multinational Enterprises

Prema-chandra Athukorala () and Archanun Kohpaiboonb

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: This paper examines patterns and determinants of overseas R&D investment by US-based manufacturing MNEs using a new panel dataset over the period 1990-2004. The analysis reveals that R&D intensity of operation of US MNE affiliates is mainly determined by the domestic market size, overall R&D capability and cost of hiring R&D personnel. There is no evidence to suggest that financial incentives have a significant impact on inter-country differences in R&D intensity when controlled for other relevant variables. Overall, our findings cast doubts on the efficacy of efforts by host country governments entice MNEs affiliates to engage in domestic R&D in a global context where R&D is becoming a truly global activity.

Keywords: R&D; multinational enterprises; foreign direct investment (search for similar items in EconPapers)
JEL-codes: F21 O19 O32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ino
Date: 2009
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Journal Article: Globalization of R&D by US-based multinational enterprises (2010)
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Persistent link: http://EconPapers.repec.org/RePEc:pas:papers:2009-07

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