The effects of offshore production on onshore innovation: Evidence from Japanese multinationals

Nobuaki Yamashita and Isamu Yamauchi

Research Policy, 2019, vol. 48, issue 9, -

Abstract: This paper examines a largely unexplored channel of the effects of offshore production on onshore (domestic) innovation performance. We combine a comprehensive dataset mapping the global operations of Japanese multinational firms with patent statistics to measure innovation. The study finds that increased offshore production have little effects on onshore innovation performance once properly correcting a simultaneity bias. Furthermore, we find some weak evidence of increased offshore production downgrades the quality of innovation, measured by citations. Consistent with other studies, we find that an increase in overseas R&D is the main driver of innovation creation for multinational firms.

Keywords: Innovation; Offshoring; International knowledge sourcing; Multinational firms; Japan (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:48:y:2019:i:9:23

DOI: 10.1016/j.respol.2019.103836

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