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Interaction between Host Countries’ Innovation Systems and Investment Strategies of Transnational Corporations: A Case Study of a US-based Conglomerate

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  • Achareeya Nawan

    (College of Innovation, Thammasat University, Thailand)

  • Patarapong Intarakumnerd

    (National Graduate Institute for Policy Studies (GRIPS), Japan)

Abstract

Though the roles of transnational corporations (TNCs) in host countries have been extensively studied, there is not enough empirical research on the interactions between corporate strategies of transnational corporations and innovation systems of host countries. This research is based on a single case study of a US-based Conglomerate investing in several countries around the globe. We paid particular attention to their investments in Singapore and Thailand and investigated how strategies of this TNC interact with national innovation systems of these two countries. The findings illustrate that Singapore’s National Innovation System is much stronger and more pro-active in inducing new investment from the TNC. Over time, it incentivised and pressured the company to move up the global value chain by investing in activities requiring higher technological and innovative capabilities. There is a strong relationship between Singapore’s national innovation system and investment by the TNC. This is not the case for Thailand.

Suggested Citation

  • Achareeya Nawan & Patarapong Intarakumnerd, 2013. "Interaction between Host Countries’ Innovation Systems and Investment Strategies of Transnational Corporations: A Case Study of a US-based Conglomerate," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 5(2), pages 131-154, July.
    • Handle: RePEc:umk:journl:v:5:y:2013:i:2:p:131-154
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    More about this item

    Keywords

    innovation systems; investment strategies; Singapore; Thailand; transnational corporations;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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