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Overseas R&D Activities And Home Productivity Growth: Evidence From Japanese Firm‐Level Data

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  • YASUYUKI TODO
  • SATOSHI SHIMIZUTANI

Abstract

This paper investigates the impact of overseas subsidiaries' R&D activities on the productivity growth of parent firms using firm‐level data for Japanese multinational enterprises. Based on survey responses, we classify each overseas subsidiary's R&D as either ‘innovative R&D,’ which we hypothesize is likely to lead to the acquisition of foreign knowledge, or ‘adaptive R&D,’ which is more likely to lead to adaptation to local conditions. We find that overseas innovative R&D raises the parent firm's productivity growth, while adaptive R&D has no such effect. In addition, overseas innovative R&D does not improve the rate of return on home R&D.

Suggested Citation

  • Yasuyuki Todo & Satoshi Shimizutani, 2008. "Overseas R&D Activities And Home Productivity Growth: Evidence From Japanese Firm‐Level Data," Journal of Industrial Economics, Wiley Blackwell, vol. 56(4), pages 752-777, December.
    • Handle: RePEc:bla:jindec:v:56:y:2008:i:4:p:752-777
    DOI: 10.1111/j.1467-6451.2008.00363.x
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