Damijan, Joze P. and Kostevc, Crt and Rojec, Matija (2010) Does a foreign subsidiary's network status affect its innovation activity? Evidence from post-socialist economies. [ Working Papers; nº 06/10, ]
Official URL: http://eprints.ucm.es/10861/1/WP_06-10.pdf
A detailed questionnaire survey among 809 foreign subsidiaries in five post-socialist economies (East Germany,
Poland, Romania, Slovenia and Croatia) is used to study determinants of innovation activity of foreign
subsidiaries. Survey data comprise traditional firm innovation activity determinants and indicators of a foreign
subsidiary status. Our findings demonstrate that foreign subsidiaries are relatively independent as far as
innovation activity is concerned, while at the same time subsidiaries with better access to foreign parent
companies R&D results are more likely to innovate. Important differences, however, are found in factors that
determine product and process innovation: (i) subsidiaries that invest more in R&D exhibit higher probability
for product but not for process innovation; (ii) acquisition of external knowledge and company size have
significant and positive impact on on process innovation only, (iii) transfer of responsibilities from headquarters
to subsidiaries and foreign investor being a MNE is conducive to process innovation; (iv) marketseeking
motivation of foreign investors has a negative impact on product innovation status; (v) higher age of
subsidiary is positive for its process innovation, i.e. a foreign investor needs some time to initiate innovation
activities in a subsidiary.
|Item Type:||Working Paper or Technical Report|
|Uncontrolled Keywords:||Transnational firms, Direct inversion, Networks, Innovation activity, Post-socialist economies.|
|Subjects:||Social sciences > Economics > Economic integration|
Social sciences > Economics > Industrial organization
Social sciences > Economics > World economy
Social sciences > Economics > Business enterprises
|Series Name:||Working Papers|
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