Keywords
knowledge spillovers
specialisation externalities
cross-border patent ownership
patent statistics
technological specialisation
domestic specialisation
foreign specialisation
How to Cite
Abstract
Most research on R&D internationalisation focuses on comparative analysis of location factors at the national level of analysis. Very little work, however, has taken place in this field for the sub-national regional location behavior of multi-national enterprises (MNE). The paper contributes to the existing research by providing evidence on the determinants of foreign technological activities at the sub-national level for Germany, which hosts the largest share of foreign R&D within the EU27 and features the highest cross-regional dispersion of patented research. Using a pooled count data model, we estimate the effect of various sources for externalities on the extent of foreign technological activity across regions. Particular attention is paid to the role of local knowledge spillovers, technological specialization and diversification. We differentiate foreign and domestic sources of specialisation and account for region and sector-specific influences. This is the first time that the ‘cross-border-ownership’ principle to measure R&D internationalisation is combined with regionalised patent information.
To verify our findings we develop hypotheses. In particular, we expect and find that foreign technological activity is attracted by technologically specialised sectors of regions. In contrast to current empirical work, this effect applies both to foreign as well as domestic sources of specialization, although effects on foreign specialization seem more significant. We expect and find the same for science-industry spillovers. We postulate a negative impact of domestic specialization on foreign technological activities and a strong positive effect from diversificationspillovers, by comparison with specialisation spillovers, but these hypotheses are rejected. We find that the direction of the specialisation effect depends on dominance in the position of domestic firms as well as on the balance of knowledge flows between them and foreign actors.
References
Acs Z.J., de la Mothe J., Paquet G. (2000) Regional innovation: In search of an enabling strategy // Regional Innovation, Knowledge and Global Change / Ed. Z.J. Acs. London: Pinter.
Adams J.D. (2001) Comparative Localisation of Academic and Industrial Spillovers. NBER Working Paper № 8292. Cambridge (MA): NBER.
Alcácer J., Chung W. (2007) Location strategies and knowledge spillovers // Management Science. Vol. 53. № 5. Р. 760-776.
Almeida P., Kogut B. (1997) The exploration of technological diversity and the geographic localization of innovation // Small Business Economics. Vol. 9. P. 21-31.
Athukorala P., Kohpaiboon A. (2010) Globalization of R&D by US-based multinational enterprises // Research Policy. Vol. 39. № 10. Р. 1335-1347.
Audretsch D.B., Feldman M.P. (1996) R&D spillovers and the geography of innovation and production // American Economic Review. Vol. 86. № 3. Р. 630-640.
Audretsch D.B., Stephan P.E. (1996) How localized are networks in biotechnology? //American Economic Review. Vol. 86. № 3. Р. 641-652.
Barrios S., Görg H., Strobl E. (2006) Multinationals' location choice, agglomeration economies and public incentives // International Regional Science Review. Vol. 29. № 1. Р. 81-107.
Basile R., Benfratello L., Castellani D. (2012) Geoadditive Models for Regional Count Data: An Application to Industrial Location. ERSA conference paper 2012-89. Louvain-la-Neuve: European Regional Science Association (ERSA).
Basile R., Castellani D., Zanfei A. (2008) Location choice of multinational firms in Europe: The role of EU cohesion policy // Journal of International Economics. Vol. 74. № 2. Р. 328-340.
Bloom N., Griffith R., Reenen J.V. (2002) Do R&D tax credits work? Evidence from a panel of countries 1979-1997 // Journal of Public Economics. Vol. 85. P. 1-31.
Breschi S. (2000) The Geography of Innovation: А Cross Sector Analysis // Regional Studies. Vol. 34. № 3. Р. 213-229.
Buckley P.J., Casson M.C. (1976) A log-run theory of the multinational enterprise // The future of the multinational enterprise / Eds. P.J. Buckley, M.C. Casson. London: Macmillan. P. 32-65.
Cantwell J.A. (1989) Technological innovations in multinational corporations. Oxford: Blackwell.
Cantwell J.A. (1995) The globalization of technology: What remains of the product cycle model? // Cambridge Journal of Economics. Vol. 19. № 1. Р. 155-174.
Cantwell J.A. (2000) Multinational Corporations and the Location of Technological Innovation in the UK regions // Regional Studies. Vol. 34. № 4. Р. 317-332.
Cantwell J.A., Iammarino S. (1998) MNCs, technological innovation and regional systems in the EU: Some evidence in the Italian case // International Journal of the Economics of Business. Vol. 5. № 3. Р. 383-408.
Cantwell J.A., Iammarino S. (2000) Multinational Corporations and the Location of Technological Innovation in the UK Regions // Regional Studies. Vol. 34. № 4. Р. 317-322.
Cantwell J.A., Iammarino S. (2001) EU Regions and Multinational Corporations: Change, Stability, and the Strengthening of Comparative Technological Advantages // Industrial and Corporate Change. Vol. 10. № 4. Р. 1007-1037.
Cantwell J.A., Iammarino S. (2003) Multinational Corporations and European Regional Systems of Innovation. London: Routledge.
Cantwell J.A., Kosmopoulou E. (2002) What determines the internationalisation of corporate technology? // Critical Perspectives in Internationalisation / Eds. M. Forsgren, H. Hakonson. Oxford: Pergamon. P. 38-57.
Cantwell J.A., Noonan C. (2002) The regional distribution of technological development: Evidence from FDI in Germany // Knowledge Spillovers and the Geography of Innovation / Eds. M. Feldman, N. Massard. Dordrecht: Kluwer. P. 199-233.
Cantwell J.A., Piscitello L. (2005) The recent location of foreign owned R&D activities by large multinational corporations in European region: The role of spillovers and externalities // Regional Studies. Vol. 39. № 1. Р. 1-16.
Cantwell J.A., Piscitello L. (2007) Attraction and deterrence in the location of foreign owned R&D activities: The role of positive and negative spillovers // International Journal of Technological Learning, Innovation and Development. Vol. 1. № 1. Р. 87-111.
Cantwell J.A., Sanangelo G. (1999) The frontier of international technology networks: Sourcing abroad the most highly tacit capabilities // Information Economics and Policy. Vol. 10. P. 101-123.
Castellani D., Palmero A.J., Zanfei A. (2011) The Gravity of R&D FDIs. Working Papers in Economics, Mathematics and Statistics, 2011-06. Perugia: University of Perugia.
Castells M., Hall P. (1994) Technopoles of the World: The Making of the 21st Century Industrial Complexes. New York: Routledge.
Christaller W. (1966) Die zentralen Orte in Süddeutschland. Jena: Fischer.
Cincera M., van Pottelsberghe de la Potterie B., Veugelers R. (2006) Assessing the foreign control of production of technology: The case of a small open economy // Scientometrics. Vol. 66. № 3. Р. 493-512.
Cowan R., David P.A., Foray D. (2000) The explicit economics of knowledge codification and tacitness // Industrial and Corporate Change. Vol. 9. № 2. Р. 211-253.
Criscuolo P., Narula R., Verspagen B. (2005) Role of home and host country innovation systems in R&D internationalisation: A patent citation analysis // Economics of Innovation and New Technology. Vol. 14. № 5. Р. 417-433.
Crozet M., Mayer T., Mucchielli J.L. (2004) How do firms agglomerate? - A study of FDI in France // Regional Science and Urban Economics. Vol. 34. № 1. Р. 27-54.
Dachs B., Pyka A. (2010) What drives the internationalisation of innovation? Evidence from European patent data // Economics of Innovation and New Technology. Vol. 19. № 1. Р. 71-86.
Devereux M., Griffith R., Simpson H. (2007) Firm location decisions, regional grants and agglomeration externalities // Journal of Public Economics. Vol. 91. № 3-4. Р. 413-435.
Dunning J.H. (1977) Trade, location of economic activity and the MNE: А search for an eclectic approach // The International Allocation of Economic Activity / Eds. B. Ohlin, P. Hesselborn, P.-M. Wijkman. London: Macmillan. Р. 395-418.
Eckey H.-F., Kosfeld R., Türck M. (2006) Räumliche Ökonometri // Wirtschaftswissen-schaftliches Studium. Vol. 35. № 19. Р. 548-554.
Erken H., Kleijn M. (2010) Location Factors of International R&D Activities - An Econometric Approach // Economics of Innovation and New Technology. Vol. 19. № 3. Р. 203-232.
Frietsch R., Schmoch U., Neuhäusler P., Rothengatter O. (2010) Transnational Patents - Structures, Trends and Recent Developments. Studien zum Deutschen Innovationssystem № 9/2010. Berlin: Expertenkommission Forschung und Innovation.
Gauselmann A., Marek P. (2012) Regional Determinants of MNE's Location Choice in Transition Economies // Empirica. Vol. 39. № 4. Р. 487-511.
Guellec D., van Pottelsberghe de la Potterie B. (2001) The internationalisation of technology analysed with patent data // Research Policy. Vol. 30. P. 1253-1266.
Guellec D., van Pottelsberghe de la Potterie B. (2004) Measuring the internationalisation of the generation of knowledge. An approach based on patent data // Handbook of quantitative science and technology research. The use of publication and patent statistics in studies on S&T systems / Eds. H.F. Moed, W. Glänzel, U. Schmoch. Dordrecht: Kluwer Academic Publishers. P. 645-662.
Guimaraes P., Figueiredo O., Woodward D. (2000) Agglomeration and the location of foreign direct investment in Portugal // Journal of Urban Economics. Vol. 47. № 1. Р. 115-135.
Görg H., Strobl E. (2003) Footloose multinationals? // The Manchester School. Vol. 71. № 1. P. 1-19.
Hall B.H. (2011) The Internationalization of R&D. UNU-MERIT Working Paper № 49. Maastricht: University of Maastricht.
Hatzichronoglou T. (1997) Revision of the High-Technology Sector and Product Classification. OECD STI Working Paper № 1997/2. Paris: OECD.
He C. (2002) Information costs, agglomeration economies and the location of foreign direct investment in China // Regional Studies. Vol. 36. P. 1029-1036.
Helpman E. (2006) Trade, FDI, and the Organization of Firms // Journal of Economic Literature. Vol. 44. P. 589-630.
Hines J.R., Jr. (1993) On the Sensitivity of R&D to Delicate Tax Changes: The Behavior of U.S. Multinationals in the 1980s // Studies in International Taxation / Eds. A. Giovannini, R.G. Hubbard, J. Slemrod. Chicago: University of Chicago Press. P. 149-194.
Hines J.R., Jr. (1994) No Place Like Home: Tax Incentives and the Location of R&D by American Multinationals // Tax Policy and the Economy. Vol. 8. P. 65-104.
IWH, DIW, LMU, WU (2013) Internationale FuE-Standorte. Studien zum deutschen Innovationssystem № 11/2013. Berlin: Expertenkommission Forschung und Innovation.
Ito B., Wakasugi R. (2007) What factors determine the mode of overseas R&D by multinationals? Empirical evidence // Research Policy. Vol. 36. № 8. P. 1275-1287.
Jacobs J. (1969) The economy of cities. New York: Vintage.
Jaffe A. (1989) Real effects of academic research // American Economic Review. Vol. 75. № 5. Р. 957-970.
Jaffe A., Trajtenberg M. (1996) Flows of Knowledge from Universities and Federal Labs: Modelling the Flow of Patent Citations over Time and across Institutional and Geographic Boundaries. NBER Working Paper № 5712. Washington: NBER.
Jaffe A., Trajtenberg M., Henderson R. (1993) Geographical localisation of knowledge spillovers, as evidenced by patent citations // Quarterly Journal of Economics. Vol. 58. P. 577-598.
Jindra B. (2011) Internationalisation Theory and Technological Accumulation - An Investigation of Multinational Affiliates in East Germany. Studies in Economic Transition. Houndsmill, Basingstoke: Palgrave Macmillan.
Kline S.J., Rosenberg N. (1986) An overview of innovation // The Positive Sum Strategy / Eds. R. Landau, N. Rosenberg. New York: National Academy Press.
Kogut B., Chang S. (1991) Technological capabilities and Japanese FDI in the United States // Review of Economics and Statistics. Vol. 73. № 3. Р. 401-413.
Kumar N. (1996) Intellectual property rights protection, market orientation and location of overseas R&D activities by multinational enterprises // World Development. Р. 24. № 4. Р. 673-688.
Malecki J. (1985) Industrial location and corporate organization in high technology industries // Economic Geography. Vol. 61. № 4. Р. 345-369.
Marek P. (2012) Agglomeration and FDI in East German Knowledge-Intensive Business Services // Economia Politica. Vol. 29. № 3. Р. 343-360.
Mariotti S., Piscitello L. (1995) Information Costs and Location of FDIs within the Host Country: Empirical Evidence from Italy // Journal of International Business Studies. Vol. 26. № 4. Р. 815-841.
Mariotti S., Piscitello L., Elia S. (2010) Spatial Agglomeration of Multinational Enterprises: The Role of Information Externalities and Knowledge Spillovers // Journal of Economic Geography. Vol. 10. P. 519-538.
Marshall A. (1920) Principles of Economics (Revised edition). London: MacMillan.
McCann P., Mudambi R. (2004) The Location Behavior of the Multinational Enterprise: Some Analytical Issues // Growth and Change. Vol. 35. № 4. Р. 491-524.
McCann P., Mudambi R. (2005) Analytical differences in the economics of geography: The case of the multinational firm // Environment and Planning. Vol. 37. Р. 1857-1876.
Nelson R.R. (1993) National Innovation Systems: A Comparative Analysis. Oxford: Oxford University Press.
OECD (2008a) Recent Trends in the Internationalisation of R&D in the Enterprise Sector, Special Session of Globalisation. Working Paper DSTI/EAS/IND/SWP (2006)1/Final. Paris: OECD.
OECD (2008b) The Internationalisation of Business R&D: Evidence, Impacts and Implications. Paris: OECD.
OECD (2009) OECD Patent Statistics Manual. Paris: OECD.
Patel P. (2010) Location of Innovative Activities of EU Large Firms. Deliverable 3.1.1 of 7th EU FP Project «GlobInn: The Changing Nature of Internationalization of Innovation in Europe: Impact on Firms and the Implications for Innovation Policy in the EU», March. University of Sussex.
Patel P., Vega M. (1999) Patterns of internationalisation of corporate technology: Location vs. home country advantages // Research Policy. Vol. 28. № 2-3. Р. 145-155.
Polanyi M. (1967) The Tacit Dimension. New York: Anchor Books.
Rosenberg N., Nelson R.R. (1996) The roles of universities in the advance of industrial technology // Engines of Innovation: US Industrial Research at the End of an Era / Eds. R.S. Rosenbloom, W.J. Spencer. Boston (MA): Harvard Business School Press.
Rosenthal S., Strange W.C. (2004) Evidence on the nature and sources of agglomeration economies // Handbook of Regional and Urban Economics / Eds. J.V. Henderson, J. F. Thisse. P. 2119-2171.
Saxenian A. (1994) Regional Advantage - Culture and Competition in Silicon Valley and Route 128. Cambridge, MA: Cambridge University Press.
Schmoch U. (2008) Concept of a Technology Classification for Country Comparisons - Final Report to the World Intellectual Property Organisation (WIPO). Karlsruhe: Fraunhofer Institute for Systems and Innovation Research.
Schmoch U., Laville F., Patel P., Frietsch R. (2003) Linking Technology Areas to Industrial Sectors - Final Report to the European Commission, November. Karlsruhe, Paris, Brighton: DG Research.
Soete L. (1987) The impact of technological innovation on international trade patterns: The evidence Reconsidered // Research Policy. Vol. 16. № 2-4. Р. 101-130.
Thomson R. (2013) National scientific capacity and R&D offshoring // Research Policy. Vol. 42. № 2. Р. 517-528.
Verspagen B., Schoenmakers W. (2004) The spatial dimension of patenting by multinational firms in Europe // Journal of Economic Geography. Vol. 4. № 1. Р. 23-42.
Von Hippel E. (1994) Sticky information and the locus of problem solving: Implications for innovation // Management Science. Vol. 40. P. 429-439.
Winkelmann R., Boes S. (2006) Analysis of Microdata. Berlin, Heidelberg: Springer-Verlag.
This work is licensed under a Creative Commons Attribution 4.0 International License.