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On the R&D giants’ shoulders: do FDI help to stand on them?

Sandro Montresor () and Antonio Vezzani ()

Economia e Politica Industriale: Journal of Industrial and Business Economics, 2015, vol. 42, issue 1, 33-60

Abstract: We investigate the impact of outward Foreign Direct Investments (FDI) on the Multinational Corporations technological leadership, meant as the capacity of entering and remaining among the top Research & Development (R&D) world investors. The research hypotheses are formulated by distinguishing FDI in R&D from FDI in other economic activities. The findings support our hypotheses with respect to the top R&D circles of the European Industrial Research and Innovation Scoreboard. Increasing the number of FDI projects in R&D makes the entrance in these circles more probable. The same holds true for non-R&D FDI, but with a lower impact. The number of R&D–FDI also reduces the probability of exiting from the circles, while that of non-R&D ones does not. These results are robust when the value of FDI projects in R&D is considered, apart from their impact on the exit from the circles, which appears to vanish. Although with caveats, the policy support to R&D internationalization provides companies with a sustainable competitive advantage in the race for the most substantial R&D investments and for the entailed economic and financial benefits. Copyright The Author(s) 2015

Keywords: Foreign Direct Investments (FDI); Multinational Corporations (MNCs); Research & Development (R&D); O32; F23; O33 (search for similar items in EconPapers)
Date: 2015
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Working Paper: On the R&D giants' shoulders: Do FDI help to stand on them? (2014) Downloads
Working Paper: On the R&D giants' shoulders: Do FDI help to stand on them? (2014) Downloads
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Economia e Politica Industriale: Journal of Industrial and Business Economics is currently edited by C. Cambini, M.G. Colombo, L. Piscitello, L. Rondi and A. Zanfei

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