Determinants of Swiss firms’ R&D activities at foreign locations
Open access
Date
2006Type
- Working Paper
ETH Bibliography
yes
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Abstract
Using the OLI paradigm as theoretical framework, we explain econometrically why a firm invests in foreign R&D (model A), and, if it does, which factors determine the level of foreign R&D expenditures (model B). It turns out that the pattern of explanation is quite similar for both types of decisions. In both cases, O- and I-advantages are the main drivers of foreign R&D, whereas L-disadvantages of the Swiss location do not play any role. A descriptive analysis of a series of motives of Swiss firms for performing R&D abroad shows that market-seeking is the most important motive. Knowledge-seeking and (human) resource-seeking are of intermediate importance as motives of foreign R&D, whereas efficiency-seeking objectives are hardly relevant. These results are fully in line with those of the econometric modelling. The findings of both approaches imply that foreign and domestic R&D are complements rather than substitutes. “Asset exploiting” is more prevalent as a strategy of foreign R&D than “asset augmenting”. Show more
Permanent link
https://doi.org/10.3929/ethz-a-005118434Publication status
publishedJournal / series
KOF Working PapersVolume
Publisher
KOF Swiss Economic Institute, ETH ZurichSubject
Foreign R&D; OLI paradigm; COMPANIES; FOREIGN COUNTRY; FORSCHUNG UND ENTWICKLUNG; Determinants of foreign R&D; RESEARCH AND DEVELOPMENT; UNTERNEHMEN; AUSLAND; Asset exploiting; SWITZERLAND (CENTRAL EUROPE). SWISS CONFEDERATION; SCHWEIZ (MITTELEUROPA). SCHWEIZERISCHE EIDGENOSSENSCHAFT; Asset augmenting; Motives of foreign R&DOrganisational unit
03446 - Bernauer, Thomas / Bernauer, Thomas
02525 - KOF Konjunkturforschungsstelle / KOF Swiss Economic Institute
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ETH Bibliography
yes
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