We investigate the effect of research and development (R&D) offshoring from high-income regions to prominent emerging economies. Specifically, we examine whether there is a complementary relationship between a region’s home and foreign investments in R&D that affects home’s regional knowledge production. Using a theoretical framework based on economic geography and the literature on international knowledge sourcing, we conjecture that high-income regions would have a comparative advantage in high-tech R&D, while emerging economies would have an advantage in medium/low R&D. Complementarity should obtain when the comparative advantages of the geographical areas are utilized. We find overall empirical support for this prediction.
- R&D Offshoring
- Knowledge Production
- Emerging Countries
M. D'Agostino, L., Laursen, K., & Santangelo, G. D. (2013). The Impact of R&D Offshoring on the Home Knowledge Production of OECD Investing Regions. Journal of Economic Geography, 13(1), 145-175. https://doi.org/10.1093/jeg/lbs012