Fundamental R&D Spillovers and the Internationalization of a FirmÌs Research Activities

Bernard Franck and Robert Owen ()
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Bernard Franck: University of Caen

No 1425, Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University

Abstract: A conceptual framework is proposed for analyzing how differences in national R&D stocks can impact on a firmÌs decision to internationalize its R&D activities. A central finding is that the integration of product markets can generate an added incentive to undertake R&D abroad. A three-stage analysis of a non-cooperative game is proposed, which entails cost-reducing process innovation in an international model of duopoly. Each firmÌs technological efficiency depends not only on its investment in applied R&D, but also on its absorption of domestic and foreign fundamental R&D, as well as the extent to which the latter are substitutes or complements. In a first stage, a firmÌs absorption of foreign fundamental R&D can be impacted by a decision to localize R&D activities abroad. The interrelation between this decision and initial production costs is also explored.

Keywords: Fundamental R&D; spillovers; international location; economic integration (search for similar items in EconPapers)
JEL-codes: F15 F23 O3 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2003-06
New Economics Papers: this item is included in nep-ino
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Citations: View citations in EconPapers (5)

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Related works:
Working Paper: Fundamental R&D Spillovers and the Internationalization of a Firm's Research Activities (2004)
Working Paper: Fundamental R&D spillovers and the internationalization of a firm's research activities (2003)
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