Stop the Knowledge Flow: Knowledge Protection Intensity of MNC Subsidiaries

Recent research has given special attention to international knowledge spillovers. Yet, multinational companies (MNCs) subsidiaries are generally treated as passive actors by most studies. We challenge this assumption by investigating the drivers of knowledge protection intensity of MNC subsidiaries. We argue that knowledge protection intensity is determined by MNC subsidiary mandates and by opportunities and risks originating from the host region. We
hypothesize that not just competence-creating but also competence-exploiting mandates increase knowledge protection intensity. In addition, technological cluster regions in the host country can be expected to provide opportunities for
knowledge sourcing and MNC subsidiaries may be willing to protect knowledge less intensively to participate in cluster networks. We test our hypotheses using a dataset of 694 observations of 631 MNC subsidiaries in Germany and develop recommendations for research, managers and policy makers.