Knowledge sourcing by foreign multinationals: Patent citation analysis in the U.S. semiconductor industry

Almeida, Paul

doi:10.1002/smj.4250171113

Cited by 731 publications

(485 citation statements)

References 15 publications

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“…The results are ambiguous. Some studies find that only low-productivity firms engage in technology-sourcing FDI, which would imply that the knowledge spillover potential from this type of FDI is low (Kogut and Chang 1991;Hennart and Park 1993;Almeida 1996;Neven and Siotis 1996). Other studies show that high-productivity firms are more likely to undertake technology-sourcing FDI, which would imply that the potential for spillover is high (Cantwell and Janne 1999;Chung and Alcácer 2002;Berry 2006;Branstetter 2006;Griffith, Harrison, and van Reenen 2006).…”

Section: Notesmentioning

confidence: 99%

Collecting the Pieces of the FDI Knowledge Spillovers Puzzle

Smeets¹

2008

The World Bank Research Observer

237

145

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Recent surveys of the empirical literature have concluded that the evidence is mixed on the magnitude, direction, and even existence of knowledge spillovers from foreign direct investment (FDI). This article reviews the recent theoretical and empirical literature that responds to these inconclusive results and considers three main issues: spillover channels, mediating factors, and FDI heterogeneity. Studies that take into account individual spillover channels find robust evidence of knowledge spillovers from FDI. Studies on the importance of mediating factors and FDI heterogeneity are less conclusive and could benefit from greater convergence in methodologies and greater specificity in the spillover channels of interest. More generally, many studies do not properly distinguish between knowledge spillovers and knowledge transfers, and empirical studies seem to greatly outnumber theoretical studies. JEL codes: F23, O33In the face of difficulties associated with capturing spillover effects and the multitude of factors that can influence the extent of spillovers in each economy, we caution researchers about drawing generalized conclusions about the existence of externalities associated with [foreign direct investment] . . . . (Javorcik and Spatareanu 2005, 47) Over the past decade or so a large body of research has examined knowledge spillovers from foreign direct investment (FDI). At several points along the way scholars have paused to take stock of the evidence (Blomström and Kokko 1998;Saggi 2002;Görg and Greenaway 2004). The verdict has largely been inconclusive. Indeed, the empirical inconclusiveness has become so infamous that virtually every study reviewed here begins with this observation as its main motivation. Explanations for the lack of conclusive results have focused on methodological and measurement issues (Görg and Strobl 2001), but this sort of approach has recently been disputed (Lipsey and Sjöholm 2005 The literature has developed in several directions to account for the ambiguity in earlier work. This study reviews these contributions, both theoretical and empirical. To provide some structure in a rapidly expanding field and to identify which approach or combination of approaches is likely to yield the most promising results, the study is structured around three themes. 1 More insight into the conditions under which knowledge spillovers from FDI are most likely to arise is especially important for developing countries. The highly ambiguous evidence to date on the existence of knowledge spillovers from FDI does not seem to warrant the large sums of money spent by governments to attract FDI. 2 After setting the stage in the following section, the article is then structured around figure 1, a representation of the FDI knowledge spillover process and the pieces of the puzzle that may affect it. 3 The section on opening the black box of FDI knowledge spillovers discusses the research on vertical linkages, worker mobility, and demonstration effects. This is followed by a review of the evidence o...

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Section: Notesmentioning

confidence: 99%

Collecting the Pieces of the FDI Knowledge Spillovers Puzzle

Smeets¹

2008

The World Bank Research Observer

237

145

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“…Furthermore, the rising role of M&A's (mergers and acquisitions) demonstrates the mounting relevance of strategic asset seeking FDI. In fact, several contributions on the geographical distribution of R&D and registered patents reveal that MNEs increasingly seek locations with access to knowledge-intensive assets, learning experiences, management expertise, and organizational competence (Almeida, 1996;Kuemmerle, 1996;Cantwell & Harding, 1998).…”

Section: Globalization Induced New Forms Of Tradementioning

confidence: 99%

The Legacy of Conventional Textbook Trade Theory in the Light of Globalization

Nagel¹,

Burnete²

2018

JMAA

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The term "globalization" designates the rapidly advancing international economic integration through substantial growth in trade of goods and services as well as surging cross-border factor mobility from the early 1990s onwards.This acceleration in the liberalization of world trade and capital movements is largely attributable to technological progress which significantly curtailed the expenses for transport as well as communication. In conjunction with the progressing opening of major newly industrializing economies endowed with abundant and cheap labor forces, it has reinforced a geographical fragmentation of production processes according to cost considerations. This phenomenon termed as "vertical specialization", "outsourcing" or also "slicing the value chain" in turn has translated into a hike in FDI and international trade of intermediate products. The main objective of this paper is to identify adequate trade models for assessing the corresponding effects of those developments. In this context, textbook trade theories spanning from comparative advantage à la Ricardo to the new-new trade theory are examined. Subsequently, we expand on globalization-induced new forms of trade (intra-firm trade, trade within the value chain) and finally conclude with our findings to properly account for those trends.

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“…However, Gassmann and von Zedtwitz (1999) find strong evidence that when foreign technology development becomes too significant to ignore companies establish 'listening posts' in areas of technological expertise around the World. In a study of patent citations in the US semiconductor industry, Almeida (1996) finds that foreign subsidiaries make more use of sector and geographically specific knowledge than do domestic firms, and concludes that Korean and European subsidiaries in particular use 'knowledge sourcing' from US firms to upgrade their technological ability in areas in which they 4 are relatively weak. An analysis of foreign R&D direct investment in the United States by Serapio and Dalton (1999) concludes that the nature of such investment is changing, with more emphasis on gaining direct access to American technology and expertise, especially in biotechnology and electronics.…”

Section: Evidence On Technology Sourcingmentioning

confidence: 99%

“…The next stage is therefore to test whether the hypothetical categories developed by Patel and Vega (1999) Soete (1987) and used subsequently by Cantwell (1989). Almeida (1996) also makes use of a similar index. Soete's RTA index uses patents rather than R&D expenditure, and is thus an output rather than an input measure.…”

Section: A) Outward Fdimentioning

confidence: 99%

Technology sourcing versus technology exploitation: an analysis of US foreign direct investment flows

Love¹

2003

Applied Economics

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The traditional paradigm of foreign direct investment suggests that FDI is undertaken principally to exploit some firm-specific advantage in a foreign country which provides a locational advantage to the investor. However, recent theoretical work suggests a model of FDI in which the motivation is not to exploit existing technological advantages in a foreign country, but to access such technology and transfer it from the host economy to the investing multinational corporation via spillover effects. This paper tests the technology sourcing versus

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Knowledge sourcing by foreign multinationals: Patent citation analysis in the U.S. semiconductor industry

Cited by 731 publications

References 15 publications

Collecting the Pieces of the FDI Knowledge Spillovers Puzzle

Collecting the Pieces of the FDI Knowledge Spillovers Puzzle

The Legacy of Conventional Textbook Trade Theory in the Light of Globalization

Technology sourcing versus technology exploitation: an analysis of US foreign direct investment flows

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