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Multinationals and domestic firms in France: who gains from knowledge spillovers?

Author

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  • Pierre Blanchard

    (Université Paris-Est, ERUDITE (EA 437), UPEC)

  • Claude Mathieu

    (Université Paris-Est, ERUDITE (EA 437), UPEC)

Abstract

This paper aims to evaluate the direction, nature, and magnitude of spillovers between foreign-owned firms and French firms from firm-level panel data. We estimate production functions at the firm level using the recent structural techniques suggested in Ackerberg et al. (2006). From our results, three main conclusions can be drawn. First, spillovers are at work in all research-intensive sectors, although they have very weak effects in the less knowledge-based sectors. Second, foreign-owned firms belonging to high- and medium-technology manufacturing industries that are set up in France benefit from horizontal spillovers, suggesting a technology sourcing activity of foreign multinationals. Third, inward foreign investment increases the total factor productivity of French firms supplying inputs to multinationals (backward spillovers) only in high- and medium-technology manufacturing industries and after 4 years.

Suggested Citation

  • Pierre Blanchard & Claude Mathieu, 2016. "Multinationals and domestic firms in France: who gains from knowledge spillovers?," Review of Agricultural, Food and Environmental Studies, Springer, vol. 97(2), pages 109-125, September.
    • Handle: RePEc:spr:roafes:v:97:y:2016:i:2:d:10.1007_s41130-016-0009-2
    DOI: 10.1007/s41130-016-0009-2
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    4. Rama, Ruth, 2023. "Technological Transfer Channels of Food and Beverage Processing Multinationals to Host Countries: An Empirical Analysis," MPRA Paper 118162, University Library of Munich, Germany.

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    More about this item

    Keywords

    Productivity; FDI and reverse spillovers; Multinationals; Domestic firms; Panel data;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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