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International R&D spillovers and multinational activity
Governments have adopted plans to attract foreign direct investment (FDI). It is commonly argued that inward FDI will benefit domestic firms. The magnitude of such benefits depends on how knowledge is transmitted and on the extent of knowledge flows (spillovers). The correct measurement of the externalities that arise in the presence of multinational activities and the relevance of the transmission channels remains an open question.
Our objectives are:
  • To determine the role played by technological distance and by geographic distance between domestic and foreign firms in measuring spillovers from FDI activity.
  • To examine how firm heterogeneity and country asymmetries help explain the existence and the intensity of technology spillovers.



The paper Factors mediating (foreign) R&D spillovers (by D. A��n and M. Manj�n) analyses the extent to which domestic _rms reap productivity gains from R&D spillovers of foreign affiliates. In particular, the authors seek to assess the relevance of the different factors mediating the spillovers intensity. To this end, foreign R&D spillovers are defined as a weighted measure of the R&D conducted by foreign affiliates and the weights are given by a smooth function of characteristics that determine the distance between domestic and foreign firms. Their approach is illustrated for a sample of UK innovative firms and construct the weights using geographical, cultural and administrative distances between the home country of the affiliates and the UK. Results show the presence of positive intra-industry foreign R&D spillovers. Also, geographical and administrative distance emerge as the main mediating factors of these FDI-transmitted spillovers.

The contribution Which innovation strategy do internationalised firms follow? Evidence from Spain by D. A��n, published in the International Journal of Multinational Corporation Strategy, compares the innovation strategy of internationalised firms, foreign-owned subsidiaries and domestic exporters, relative to firms that serve the domestic market only. The analysis is performed on a sample of Spanish manufacturing firms over the period 2006-2011. The focus is not only on different forms of innovation, distinguishing between imitation and pioneer innovation, but also on the heterogeneity of exporters and foreign-owned firms. The author finds that foreign-owned firms and domestic exporters (excluding those serving only the EU market) are more likely to introduce market novelties ahead of competitors in low-tech sectors and, to a lesser extent, imitate more than local firms. However, domestic exporters and foreign-owned firms in Spain are not more innovative (neither in terms of original nor imitative products) than local firms in high-tech sectors.

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Researcher in charge: Rafael Moner-Colonques
Facultad de Economía - Campus de Tarongers
Avda. dels Tarongers s/n - 46022 Valencia (SPAIN)
Tel.: (+34) 963 828 784 - Fax: (+34) 963 828 249
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