R&D Internationalisation and the Global Financial Crisis

Dachs, Bernhard and Zahradnik, Georg (2014): R&D Internationalisation and the Global Financial Crisis.

Abstract

This paper asks if – and how – the global financial crisis of 2008/09 has affected overseas R&D activities of multinational enterprises (MNEs). Based on a data set of OECD countries, we find that the share of MNEs on total business R&D expenditure decreased for the first time since 2001 in many countries. Data for 2011 indicate that R&D internationalisation is picking up again, but has not yet reached pre-crisis levels.

The impact of the crisis on foreign-owned firms may be explained by their higher export intensity, more demand-driven R&D, the concentration of MNE activity in R&D intensive manufacturing industries, and a smaller effect of public R&D support provided via stimulus packages after 2007.

The crisis led to a modest re-location of MNE R&D activity from the European Union to emerging economies. The shares of the European Union on total overseas R&D activities of US firms indeed decreased between 2007 and 2011, while shares of emerging economies increased; however, in absolute terms, the gains of emerging economies only small and rather a continuation of a trend which started well before 2008.

• Item Type: MPRA Paper
• Language: English
• Keywords: global financial crisis, multinational enterprises, internationalisation, R&D, innovation, foreign-owend firms
• Subjects: F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O30 - General; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O33 - Technological Change: Choices and Consequences ; Diffusion Processes

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