MNE R&D and Host Countries: Issues

Abstract

We have noted that, from the point of view of researchers focusing on the MNE as an organisation, interest in the internationalisation of R&D emerged rather belatedly and may still be considered to be an underdeveloped area of analysis. By contrast economists and policy makers concerned with the effects of MNE activity on host countries were much more prompt in recognising the relevance of the R&D performance of foreign subsidiaries operating in particular economies. Thus the major pioneering studies of investment in the UK (Dunning, 1958), Canada (Safarian, 1966) and Australia (Brash, 1966) all investigated the extent and nature of subsidiary R&D. As chapter 7 documents these precedents have been followed in a wide range of studies. In the remainder of this introductory section we briefly describe the broad context for the policy interest in MNE R&D by host countries, as one of a group of factors likely to influence the technological performance and capability of their economies. The second section of the chapter delineates the ways in which the R&D of MNE subsidiaries is likely to influence the local economy, relating these potential effects to the type of laboratory operated by the MNE.