Globalization of Innovation: The Moderating Role of Project-Level Investment Strategy and Country Type in Location Choice for R&D-Related FDI

Eliane Choquette, Stine Jessen Haakonsson, Peter D. Ørberg Jensen*, Søren Feodor Nielsen

*Corresponding author af dette arbejde

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Abstract

The current stage of globalization involves geographically dispersed research and development (R&D) investments that are not confined to advanced economies. These cross-border R&D investments are driven by multinational enterprises’ (MNEs’) strategies for exploring and/or exploiting foreign locations. In this paper, we analyse location choice and the moderating effect of project-level investment strategy (i.e. exploration or exploitation) and type of host economy (i.e. advanced or emerging) on the importance of the innovation framework and local innovation capabilities. Our analysis of 588 R&D-related foreign direct investment (FDI) projects in the pharmaceutical and biotech industries during the 2006–2016 period reveals that whereas a host country’s innovation framework and capability overall do affect the location decision, their ultimate effects are conditional on the combination of project-level investment strategy and type of economy. Our findings have policy implications for FDI policies aiming at enhancing linkages between MNEs and local actors and national science, technology, innovation and educational policies and programmes.
OriginalsprogEngelsk
TidsskriftTransnational Corporations
Vol/bind28
Udgave nummer2
Sider (fra-til)1-30
Antal sider30
ISSN1014-9562
DOI
StatusUdgivet - 2021

Emneord

  • Emerging markets
  • Innovation framework
  • Innovation capabilities
  • Investment strategy
  • R&D internationalization
  • Location choice

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