From Few to Many: Main Trends in the Internationalization of Business R&D

28 Pages Posted: 2 May 2022

See all articles by Bernhard Dachs

Bernhard Dachs

AIT Austrian Institute of Technology

Georg Zahradnik

AIT Austrian Institute of Technology GmbH

Date Written: April 28, 2022

Abstract

The paper studies the internationalization of business research and development (R&D) from 2003 up to 2017. It highlights three major results: first, R&D expenditure by foreign-owned firms has been growing, but more slowly than R&D expenditure of domestically owned firms. This is mainly due to the fast growth of business R&D in China, where foreign-owned firms have only a small share of overall business R&D. Second, R&D internationalization has become more network-like and diverse in terms of industries and countries, and less dominated by single relationships between large nations. The rise of emerging economies as host and home countries is just one of several major shifts. Service industries have gained importance as well, but often remain invisible because only a few countries collect data on R&D internationalization in services. The internationalization of R&D has yielded considerable benefits for home and host countries in the form of higher aggregate R&D expenditure and spillovers. Political de-globalization, weakening international institutions and a focus on “national interest” in science and technology may threaten these benefits in the future. A continuation of the policy of nondiscrimination of foreign-owned firms and more, not less, international cooperation is necessary.

Keywords: internationalization, research and development, innovation, transnational companies

JEL Classification: F23, O33, O38

Suggested Citation

Dachs, Bernhard and Zahradnik, Georg, From Few to Many: Main Trends in the Internationalization of Business R&D (April 28, 2022). Transnational Corporations Journal, Vol. 29, No. 1, 2022, Available at SSRN: https://ssrn.com/abstract=4096746

Bernhard Dachs (Contact Author)

AIT Austrian Institute of Technology ( email )

Donau-City-Straße 1
Vienna, 1220
Austria

Georg Zahradnik

AIT Austrian Institute of Technology GmbH ( email )

Donau-City-Straße 1
Vienna, 1220
Austria

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