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Knowledge spillovers and the assignment of R&D responsibilities to foreign subsidiaries

Knowledge spillovers and the assignment of R&D responsibilities to foreign subsidiaries Research on R&D location choice by MNCs has focused largely on host country factor endowments and overlooked the role that the potential to capture and utilize knowledge spillovers from competitors may also play in determining such choices. Using a large‐scale panel database of the foreign subsidiaries of U.S.‐based MNCs in above‐average R&D‐intensive industries, we examine the extent to which external spillover opportunities as well as internal firm‐specific capabilities to utilize such knowledge affect MNCs' new R&D location decisions. Our findings suggest that MNCs appear to anticipate potential spillover opportunities and are discriminating in assessing these opportunities not only across locations but also across categories of competitors within the same location. Further, our findings provide stronger support to predictions regarding the salience of global utilization capacity than they do to predictions regarding the salience of local utilization capacity. Copyright © 2004 John Wiley & Sons, Ltd. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic Management Journal Wiley

Knowledge spillovers and the assignment of R&D responsibilities to foreign subsidiaries

Strategic Management Journal , Volume 25 (8‐9) – Aug 1, 2004

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References (70)

Publisher
Wiley
Copyright
Copyright © 2004 John Wiley & Sons, Ltd.
ISSN
0143-2095
eISSN
1097-0266
DOI
10.1002/smj.396
Publisher site
See Article on Publisher Site

Abstract

Research on R&D location choice by MNCs has focused largely on host country factor endowments and overlooked the role that the potential to capture and utilize knowledge spillovers from competitors may also play in determining such choices. Using a large‐scale panel database of the foreign subsidiaries of U.S.‐based MNCs in above‐average R&D‐intensive industries, we examine the extent to which external spillover opportunities as well as internal firm‐specific capabilities to utilize such knowledge affect MNCs' new R&D location decisions. Our findings suggest that MNCs appear to anticipate potential spillover opportunities and are discriminating in assessing these opportunities not only across locations but also across categories of competitors within the same location. Further, our findings provide stronger support to predictions regarding the salience of global utilization capacity than they do to predictions regarding the salience of local utilization capacity. Copyright © 2004 John Wiley & Sons, Ltd.

Journal

Strategic Management JournalWiley

Published: Aug 1, 2004

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