Gone are the creatures of yesteryear? On the diffusion of technological capabilities in the ‘modern’ MNC

This paper probes the extent to which the rise of the ‘modern’ multinational corporation (MNC) has come with significantly altered patterns in the emergence and diffusion of technological capabilities across units of the MNC network. It draws upon a database containing the complete U.S. patenting history of 24 Swedish multinationals over the 1946–2008 period, which allows us to trace both the emergence and subsequent intra-firm diffusion of technological capabilities throughout the post-war period. The findings show that, over time, foreign subsidiaries have become an increasingly important source of new technological capabilities within the MNC network, and also indicate that the overall pace of capability diffusion has become faster over the observed time period. Notably, however, the results reveal substantial heterogeneity of individual firms’ approaches to organizing and managing technological capabilities within the MNC network. The relationship between evolutionary change and strategic choice emerges as a continually relevant issue in the organization and management of technology in the modern MNC.