Innovation and Foreign Ownership
CEPR Discussion Paper No. 8141
43 Pages Posted: 30 Nov 2010
There are 3 versions of this paper
Innovation and Foreign Ownership
Innovation and Foreign Ownership
Innovation and Foreign Ownership
Date Written: November 22, 2010
Abstract
This paper uses a rich panel dataset of Spanish manufacturing firms (1990-2006) and a propensity score reweighting estimator to show that multinational firms acquire the most productive domestic firms, which, on acquisition, conduct more product and process innovation (simultaneously adopting new machines and organizational practices) and adopt foreign technologies, leading to higher productivity. We propose a model of endogenous selection and innovation in heterogeneous firms that jointly explains the observed selection process and the innovation decisions. Further, we show in the data that innovation on acquisition is associated with the increased market scale provided by the parent firm.
Keywords: Foreign Ownership, Productivity, Multinational Production, Innovation
JEL Classification: D22, F23, O31
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Reallocation, Firm Turnover, and Efficiency: Selection on Productivity or Profitability?
By Lucia Foster, John Haltiwanger, ...
-
Reallocation, Firm Turnover, and Efficiency: Selection on Productivity or Profitability?
By Lucia Foster, John Haltiwanger, ...
-
Measuring and Explaining Management Practices Across Firms and Countries
By Nicholas Bloom and John Van Reenen
-
Measuring and Explaining Management Practices Across Firms and Countries
By John Van Reenen and Nicholas Bloom
-
Measuring and Explaining Management Practices Across Firms and Countries
By Nicholas Bloom and John Van Reenen
-
Measuring and Explaining Management Practices Across Firms and Countries
By Nicholas Bloom and John Van Reenen
-
Management Practices Across Firms and Countries
By Nicholas Bloom, Christos Genakos, ...
-
Inside the Family Firm: The Role of Families in Succession Decisions and Performance
By Morten Bennedsen, Kasper Meisner Nielsen, ...
-
Inside the Family Firm: The Role of Families in Succession Decisions and Performance
By Morten Bennedsen, Kasper Meisner Nielsen, ...