|Author Name||TODO Yasuyuki (Aoyama Gakuin University) /SHIMIZUTANI Satoshi (Faculty Fellow, RIETI)
|Creation Date/NO.||March 2007 07-E-008|
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This paper investigates the impact of overseas subsidiaries' R&D activities on the productivity growth of parent firms using firm-level panel data for Japanese multinational enterprises. We distinguish between overseas R&D for the utilization and acquisition of foreign advanced knowledge, or innovative R&D, and overseas R&D for the adaptation of technologies and products to local conditions, or adaptive R&D. Our major finding is that overseas innovative R&D helps to raise the productivity growth of the parent firm, while overseas adaptive R&D has no such effect. In addition, we examine whether overseas innovative R&D has an indirect effect on home productivity growth by improving the rate of return on home R&D. However, we find no evidence of such an indirect effect, suggesting that overseas innovative R&D does not engender any knowledge transfers from overseas to home R&D units.
Published: Yasuyuki Todo and Satoshi Shimizutani, 2008. "Overseas R&D Activities and Home Productivity Growth: Evidence from Japanese Firm-Level Data," The Journal of Industrial Economics, Vol. 56(4), pp. 752-777.