the role of non economic endowments introduction to the special section on what we know and what we should know about international knowledge sourcing recent developments in the pattern of international knowledge sourcing have highlighted a new international division of labor in knowledge production which now is affecting emerging as well as advanced countries the source of this division of labor has been identified as residing in the changing economic endowments of these countries we extend this by suggesting that the new international allocation of knowledge related activities is related strongly to a country s non economic endowments our arguments provide context to the papers in this special section

environmental influences on mne subsidiary roles economic integration and the nordic countries we seek to examine the importance of environmental factors in determining mne subsidiary roles in particular we examine the environmental factors associated with deep integration schemes such as the eu such schemes require a convergence of economic structure due to the establishment of common regional institutions regulations and policies specifically we distinguish between the scope of activities performed by subsidiaries and the level of competence of those subsidiaries the empirical analysis is based on a large scale survey of foreign owned units in denmark finland and norway these nordic countries differ with regard to their eu membership status norway being the outsider while the others are members but are very similar to each other in most other respects our data show that subsidiaries in norway report significantly lower scores for both scope of activities and levels of competence the effects remain strong even when we are controlling for other potentially influential factors the findings indicate that being on the outside of the eu may indeed carry the price of becoming less attractive to mne activity

lock in of mature innovation systems the transformation toward clean concrete in the netherlands energy intensive processing industries like the concrete industry form the base of the economy and account for a large part of global greenhouse gas emissions sectoral transformation to cleaner basic materials is therefore crucial and institutional pressure to do so is increasing however socio technical studies have not sufficiently addressed these sectors this paper therefore sets out to analyze the systemic problems that inhibit the transformation of the mature innovation system of the concrete sector toward the development and diffusion of clean concrete innovations for the case of the netherlands a structural functional approach has been frequently applied to identify such systemic problems but has been limited to emerging technological innovation systems consequently the approach tends to overlook the systemic lock in that arises from closed cycles of interdependent systemic problems and vested interests that characterize mature innovation systems and that hamper system transformation this paper analyzes these characteristics to extend the application of the structural functional approach to the transformation of mature innovation systems interviews with 28 stakeholders were conducted and triangulated with reports websites and other documents a list of systemic problems was identified that originate within actors institutions networks technology and infrastructure and that impaired the performance of all system functions except knowledge development systemic problems are indeed found to be sustained through systemic lock in i e closed cycles of interdependent systemic problems through strategic often collective action established firms with vested interests were able to reinforce these interdependent systemic problems to inhibit clean concrete innovation the study concludes that systemic lock in inhibits the sustainability transformation of the mature innovation system of concrete in the netherlands and confirms that the application of the structural functional approach can be extended from emerging to mature innovation systems overcoming systemic lock in requires a series of well coordinated policy measures that should be implemented in a specific order to prevent reverting back to the lock in around the original system configuration

endogenous trade policy under foreign direct investment abstract using bernheim and whinston 1986 common agency game we endogenize trade policy in a duopoly composed of a domestic firm and a foreign firm where both firms influence the domestic government s trade policy via their contributions the foreign firm can jump over trade restrictions by undertaking foreign direct investment fdi in the domestic market the government prefers a voluntary export restraint ver to a tariff for two reasons first a ver leads to higher contributions from the foreign firm than a tariff second a ver provides a higher level of protection to the domestic firm without generating fdi by the foreign firm

outward foreign direct investment patterns of italian firms in the european union s emission trading scheme we consider the role played by the european union s emissions trading system eu ets as a possible driver of outward foreign direct investment fdi for italian manufacturing firms using a panel dataset of about 22 000 firms covering the first two phases of the eu ets and the period before the eu ets we measure the patterns of fdi towards countries not covered by the eu ets the results show that the eu ets had a weak effect on the number of new subsidiaries abroad extensive margin while it had a larger impact on production taking place in foreign subsidiaries intensive margin especially in trade intensive sectors

patterns of internationalisation of corporate technology location vs home country advantages given the trends towards increasing globalisation of markets and of production the globalisation of technology remains a subject of considerable interest to analysts and policy makers in the 1990s this paper provides some new empirical observations for debate and discussion on the patterns of technological activities of large firms outside their home countries it is based on a systematic analysis of the us patenting activities of 220 of the most internationalised firms in terms of their technology in the 1990s although firms are active outside their home countries in the high technology fields such as computers pharmaceuticals telecommunications image and sound and materials quite a sizeable proportion of their foreign activities are concerned with process and machinery technologies moreover a comparison of the technological advantage of the company at home and the advantage of the location shows that in a large majority of cases firms tend to locate their technology abroad in their core areas where they are strong at home these results suggest that adapting products and processes and materials to suit foreign markets and providing technical support to off shore manufacturing plants remain major factors underlying the internationalisation of technology they are also consistent with the notion that firms are increasingly engaging in small scale activities to monitor and scan new technological developments in centres of excellence in foreign countries within their areas of existing strength however there is little evidence to suggest that even these most internationalised firms routinely go abroad to compensate for their weakness at home

a systems approach for assessing water conservation potential through demand based water tariffs sustainable and responsive water management policies are essential to provide high quality reasonably priced drinking water to consumers at any time while simultaneously ensuring a profit for the water utility such goal can be typically achieved through two different types of policy namely increasing water supply or managing water demand the latter can be performed among others through water pricing pricing especially when demand based can lead to a behavioural change in customer water use but it is arduous to introduce for a number of political and social reasons it is essential to engage with relevant stakeholders to clearly recognize pros and cons of implementing a new water tariff as a consequence in this paper economic and social implications of demand based tariff structures and their potential for greater water conservation are assessed through a participatory approach the variation of residential water demand and revenue outcomes were simulated through an integrated participatory systems approach by assuming that an inclining block tariff was introduced on the gold coast region australia such connection between price demand and revenue is highly complex and the choice of system dynamics for this modelling exercise is considered ideal as it can explicitly handle the non linearity feedbacks and interconnections of such system the simulation model was developed by collaborating with relevant stakeholders thus ensuring the logical inclusion of all the relevant inputs and connections such model integrates three components namely revenue forecasting water billing and demand feedback sub model the results show that a the inclining block tariff can effectively lead to behavioural change and water consumption reduction especially within the high water users group although the predicted water savings would be lower than when adopting water restrictions b customers feedback to an increased cost can be used to achieve revenue neutrality c based on customer feedback and modelling simulations the ideal proportion of customers to be charged with the second block tariff is 20 however this can be recalculated and varied during wet seasons or dry seasons to optimise water availability the developed model allows water planners to explore a wide range of policy alternatives e g alternative pricing scenarios to influence demand over medium to long term periods and to optimise best practice decision making for urban water conservation and management

localised production of technology for global markets given the trends towards increasing globalization of markets and of production the globalization of technology remains a subject of considerable interest to analysts and policymakers in the 1990s the main conclusion of this paper is that there is no systematic evidence to suggest that widespread globalization of technological activities occurred in the 1980s the evidence based on the u s patenting activities of 569 of the world s largest firms based in 13 countries and covering 17 product groups shows that for an overwhelming majority of them technology production remains close to the home base the analysis also shows the dangers of generalizing on the basis of anecdotal evidence from a small sample of firms from a particular country or sector c 1995 academic press inc copyright 1995 by oxford university press

r d offshoring and the productivity growth of european regions the recent increase in r d offshoring has raised fears that knowledge and competitiveness in advanced countries may be at risk of hollowing out at the same time economic research has stressed that this process is also likely to allow some reverse technology transfer and foster growth at home this paper addresses this issue by investigating the extent to which r d offshoring is associated with productivity dynamics of european regions we find that offshoring regions have higher productivity growth but this positive effect fades with the number of investment projects carried out abroad a large and positive correlation emerges between the extent of r d offshoring and the home region productivity growth supporting the idea that carrying out r d abroad strengthens european competitiveness

an empirical survey of residential water demand modelling abstract the increased reliance on demand side management policies as an urban water consumption management tool has stimulated considerable debate among economists water utility managers regulators consumer interest groups and policymakers in turn this has fostered an increasing volume of literature aimed at providing best practice estimates of price and income elasticities quantifying the impact of non price water restrictions and gauging the impact of non discretionary environmental factors affecting residential water demand this paper provides a synoptic survey of empirical residential water demand analyses conducted in the last 25 years both model specification and estimation and the outcomes of the analyses are discussed

is it more effective to bring time of use pricing into increasing block tariffs evidence from evaluation of residential electricity price policy in anhui province abstract reform of energy prices in china has stepped into a crucial stage it has become a controversial issue after the reform of increasing block tariffs ibts for household electricity followed by a time of use tou pricing policy using eles model this paper estimates the price elasticity of residential electricity demand based on perceived price and price elasticity a power structure model demand response for nonlinear electricity price is proposed taking anhui province as a case this paper analyzes the attainment situation of such policy objectives as electricity saving consumer welfare equity improvement and peak shaving with the introduction of tou pricing into ibts for household electricity the results show that ibts helps reduce electricity consumption by 0 74 0 93 with minor energy effect ibts may lead to a maximum 1 57cny increase of electricity expense per household per month which is acceptable for residents it also may reduce cross subsidy to some extent after introducing tou pricing the efficiency of peak shaving is only 2 25 2 78 and the load decrement at peak periods is far lower than the increase at valley periods while the effect of electricity conservation and cross subsidy reduction have been alleviated in other words peak valley price is not only difficult to achieve its own objective effectively but also prohibits the effect of ibts based on the above conclusions some policy recommendations are provided to improve the price reform of residential electricity natural gas and other public resources in various regions of china and foreign regions with similar electricity market

the internationalisation of r d by multinationals a trade off between external and internal proximity overseas production is frequently seen as a force inducing the decentralization of rd it should on the contrary be completed by the implementation of relations of proximity internal to the firm which they refer to as internal proximity from this perspective the multinational firm that manages dispersed r d units is seen as facing a tension an organizational trade off between external proximity and internal proximity copyright 1999 by oxford university press

protectionist policies as the regulation of international industry the political feasibility of protectionist policies that regulate international industry derives from the absence of overt collusion among domestic import competing producers the regulation of international industry cannot be explicit since governments would thereby be perceived to be approving or instigating international collusion hence voluntary export restraints have been popularly presented with a focus on the difficulties confronted by domestic import competing producers and a de emphasis on the mutual gains to domestic and foreign producers from monitoring by a foreign government of a restrictive export cartel arrangement similarly trigger price mechanisms have popularly been explained in terms of the need for anti dumping measures to preserve fair competition likewise the involuntary export tax derived in the first instance from an administratively validated but as demonstrated by kalt s econometric analysis contentious complaint of unfair foreign competition voluntary export restraints trigger price mechanisms and involuntary export taxes are however protectionist devices the beneficiaries of which can transcend national jurisdictions and which have in common the characteristic that the gains to domestic industry interests derive from the regulation of foreign competitors

navigating the impact innovation double hurdle the case of a climate change research fund this paper analyses how the funding for research grants was allocated from a specific research fund which aimed to support innovative research projects with the potential to have research impact by reducing carbon emissions the fund received a total of 106 proposals of which 27 were successful at obtaining financial support our aims were to test which factors influenced the funding decision and to discover whether or not and to what extent the fund met its intended objectives through the allocation of monies the allocation process and its outcomes were analysed using correlation logistical and linear regression to test our research hypotheses using this research funding process as a single study we found that trying to clear the impact innovation double hurdle in a single funding initiative ultimately compromises both goals this paper therefore contributes to our understanding of innovation management within the context of carbon emission reduction and explains which factors influenced success in securing research monies through the funding process

domestic politics foreign interests and international trade policy reply this paper incorporates the foreign interest in the determination of a country s international trade policy into a model of political competition between candidates contesting elective office we envisage foreign and domestic producer interests as expressing political support for a candidate via campaign contributions and candidates as making trade policy pronouncements to maximize political support from producer interests tariffs are divisive but vers are consistent with conciliatory policy positions yielding mutual gain to foreign and domestic interests no candidate has an interest in formulating a trade policy position using a tariff if a ver is a policy option protection in the developed countries has in recent years often taken the form of bilaterally negotiated voluntary export restraints vers rather than the more traditional unilaterally imposed import restrictions the use of voluntary export restraints has been paralleled by interest in the theoretical literature the effects of vers have been compared with tariffs and quotas and vers have been examined in a political economy framework with a view to identifying the gainers and losers from this form of restric

towards a theory of the technology based firm abstract the modern firm is a very viable economic institution drawing strength from a competitive market economy with embedded super markets for corporate control and sub markets for internal organization the technology based firm in addition draws strength from its co evolution with modern science and technology and vice versa and thereby becomes increasingly important however received theories of the firm of which there are many have not particularly taken account of technology and technology based firms nor their management this paper takes an empirical point of departure from recent findings regarding the positive relationship between technology diversification on the one hand and corporate growth and business diversification on the other these findings are not readily explainable by received theories of the firm which the paper reviews and the findings are thus taken as an explanandum for a proposed approach to formulate a theory of the technology based firm the approach is compatible with various other theoretical approaches such as the resource based the transaction cost and the evolutionary approach but specifically takes the idiosyncrasies of technology i e technical competence as well as management into account through notably strong economies of scale scope speed and space associated with the combination of different technologies and resources the technology based firm is subjected to specific dynamics in its growth and diversification and shifts of businesses and resources in particular a technology based firm tends to engage in technology diversification thereby becoming multitechnological as such the technology based firm has incentives to economize on increasingly expensive new technologies by pursuing strategies of internationalization on both input and output markets technology related business diversification external technology marketing and sourcing r d rationalization and technology related partnering

domestic alliance networks and regional strategies of mnes a structural embeddedness perspective we draw on a social network perspective to explain multinational enterprises mnes propensity to distribute their operations unevenly across various regions of the world we focus on how the positioning of mnes in their domestic network of strategic alliances affects their geographic scope i e whether they concentrate on their home region or expand beyond it we theorize that embeddedness in alliance networks constitutes a double edged sword to the geographic scope of mnes strong embeddedness in domestic alliance networks drives the development of location bound firm specific advantages fsas which may narrow down mnes geographic scope in contrast moderate embeddedness leads to more non location bound fsas which reduce liability of foreignness and hence motivate mnes to widen their geographical scope we thus predict a non linear relationship between domestic alliance network embeddedness and mne geographic scope furthermore the impact of the domestic alliance network on mne geographic scope hinges on the organizational ability to efficiently and effectively absorb resources stemming from the network we test our hypotheses using fdi data from 302 us mnes in the information and communication technology industry for the period of 2001 2008 and generally find robust support for the hypothesized relationships

who determines mexican trade policy using a political economy approach the authors analyze the pattern of protection in mexico s manufacturing sector during the period of trade policy reforms 1985 89 when mexico experienced significant trade liberalization and an important inflow of foreign direct investment they take into account the potential effect of foreign direct investment on endogenous tariff formation it turns out that the data support this analytic approach in which the formulation of trade policy reflects political support and in which the presence of foreign direct investment in the sector strongly affects the pattern of tariff protection before and after reform in mexican manufacturing especially sectors with heavy foreign direct investment received greater protection in import competing sectors although the move toward greater openness was associated with a reduction in the influence of industrial and foreign investor lobbying

interest group politics in a federation the optimal degree of decentralization depends on the importance of inter state externalities of local policies we show that inter state externalities are determined by the spatial distribution of interest groups within the country interest groups who have multi state scope internalize inter state externalities to a larger extent than the lobbyists with interests within a single state we use variation in the geographic boundaries of politically powerful industrial interests to estimate the effect of inter state externalities on firm performance using firm level panel data from a peripheralized federation russia in 1996 2003 we show that controlling for firm fixed effects the performance of firms substantially improves with an increase in the number of neighboring regions under influence of multi regional business groups compared to the number influenced by local business groups our findings have implications for the literatures on federalism and on international trade as trade restrictions are a common source of inter state externalities

the globalisation of technology what remains of the product cycle model this paper reexamines two hypotheses associated with earlier versions of the product cycle model the first hypothesis that innovations are almost always located in the home country of the parent company is rejected on the basis of evidence drawn from one hundred years of u s patent office data the second hypothesis that the international dispersion of activity is led by technology leaders is historically valid however over the last twenty years technology leaders have been ahead instead in the globalization of technology that is in developing internal international networks to exploit the locationally differentiated potential of foreign centers of excellence c 1995 academic press inc copyright 1995 by oxford university press

endogeneous protection factor returns and resource allocation we consider a heckscher ohlin samuelson trade model with two lobbies representing the interests of factor owners and two political parties the lobbies contribute resources to politics equating their returns to political and economic activity at the margin while the parties maximize their probability of election trading off general voter dissatisfaction with protection against the electioneering resources that favorable policies attract from the lobbies the equilibrium level of protection of a factor and its expected rate of return increase with its relative endowment if this relative endowment is high low then the factor will be better worse off than under free trade but at intermediate factor endowment ratios both factors will be worse off under parameter changes making lobbies more sensitive to the commodity price the lobbies contribute more resources to politics and can both be worse off even though the parties are proposing lower trade distortions

taxes institutions and innovation theory and international evidence we develop an international model of the design of institutions for regulating innovative activities of private corporations informational limitations faced by the social planner preclude complete contracting with private firms corporate innovation creates positive and negative externalities the social planner in each country takes into account the legal system in place and designs an umbrella of institutions that include a menu of organizational forms liability structures corporate taxes and subsidies we show that limited liability may be accompanied by excessive innovation however when the nonmonetized benefits are very high private firms may be too conservative in innovation policies firms choose their organizational form and level of innovation consistent with private optimality with the optimal institutional design for each country we demonstrate that private innovation choices are aligned with social optimality in particular we show that the optimally designed corporate tax rate in each country is a decreasing function of its legal effectiveness using data from 63 countries over 2003 2018 we document supporting evidence mncs can take advantage of differential liability and corporate tax structures across national boundaries to circumvent institutional design constraints however when mncs generate positive externalities to host countries their governments may provide subsidies and incentives

transnational firms and the changing organisation of innovative activities it is suggested that a transition is taking place towards new modes of organising transnational corporations innovative activities first different units of multinational firms including foreign based subsidiaries are increasingly involved in the generation use and transmission of knowledge secondly multinationals are developing external networks of relationships with local counterparts through which foreign affiliates gain access to external knowledge sources and application abilities as a result of this evolutionary process multinationals organisation is subject to both centripetal and centrifugal forces considerable efforts are then necessary to innovate coordination procedures and mechanisms in order to enhance the generation circulation and use of knowledge a number of empirical works are reviewed providing some evidence of the evolutionary process discussed in the paper 1 transnational companies as networks of innovators economists have long viewed innovation as being primarily generated by firms in their home countries classic contributions in the economics of multinational corporations have consolidated this view referring mainly to the us based multinationals vernon 1966 kindleberger 1969 and stopford and wells 1972 theorised a quasi colonial relationship between the parent company and foreign subsidiaries wherein the latter are in charge of replicating the former s activities abroad with strategic decisions including r d and innovation strategies being rigidly centralised particularly vernon emphasised that coordinating international innovative activities would be too costly owing to the difficulties of collecting and controlling relevant information across national borders host countries and foreign subsidiaries would then play a role almost exclusively in the adoption and diffusion of centrally created technology this view was supported mainly by us economists and based on us evidence from the early post world war ii period but it was very influential for the development of studies on the economics of transnational companies tncs and the internationalisation of

measuring systemic problems in national innovation systems an application to thailand the paper contributes to research on innovation systems in general and in particular to the current debate on rationales for innovation policy by providing a framework to identify systemic problems in a given system of innovation and test the framework empirically the data were drawn from the thai community innovation survey in the period after which a major change in the country s innovation system policy had been initiated by hierarchical factor analysis systemic problems are identified and grouped into four components institution network science and technology infrastructure and other support services the analysis allows researchers to investigate the mismatch between policies and problems and identify policy gaps c 2012 elsevier b v all rights reserved less

water security through scarcity pricing and reverse osmosis a system dynamics approach water supply and demand planning is often conducted independently of social and economic strategies there are presently no comprehensive life cycle approaches to modelling urban water balances that incorporate economic feedbacks such as tariff adjustment which can in turn create a financing capacity for investment responses to low reservoir levels this paper addresses this gap and presents a system dynamics model that augments the usual water utility representation of the physical linkages of water grids by adding inter connected feedback loops in tariff structures demand levels and financing capacity the model applied in the south east queensland region in australia enables simulation of alternatives and analysis of stocks and flows around a grid or portfolio of bulk supplies including an increasing proportion of rain independent desalination plants such rain independent water production plants complement the rain dependent sources in the region and can potentially offer indefinite water security at a price the study also shows how an alternative temporary drought pricing regime not only defers costly bulk supply infrastructure but actually generates greater price stability than traditional pricing approaches the model has implications for water supply planners seeking to pro actively plan justify and finance portfolios of rain dependent and rain independent bulk water supply infrastructure interestingly the modelling showed that a temporary drought pricing regime not only lowers the frequency and severity of water insecurity events but also reduces the long run marginal cost of water supply for the region when compared to traditional reactive planning approaches that focus on restrictions to affect demand in scarcity periods

the globalisation of technology a new taxonomy book synopsis international management of research and development brings together the most influential contributions to managing organising and coordinating r d and innovation on a global scale in addition to papers on the fundamental principles trends and drivers of international r d it covers strategies and operations of global r d it also provides an introduction to modern concepts such as knowledge networks open innovation and virtual innovation it is a key reference collection for professors researchers and practitioners

analyzing the evidence of an ipr take off in china and india abstract both china and india have been experiencing a historical take off in the use of intellectual property rights ipr in terms of trademark applications filed with domestic ip offices in 2009 the evidence demonstrates that china now ranks 1st worldwide and india 5th while for patent filings china ranks 3rd worldwide and india ranks 9th this performance is remarkable as both china and india experienced negligible demand for ipr protection as recently as two decades ago the ipr take up trends in these two countries are analyzed in detail highlighting the structure of patent and trademark demand since 1990 specifically the available series are broken down and analyzed according to i national versus foreign origin of patents and trademarks ii technological ipc and trademark nice classes and iii the major individual patent users in each country the data used refers to applications in the chinese and indian ip offices although the demand from residents of these two countries in both the international and other national systems is also assessed beyond the existing momentum in ipr registrations by china and india and their capacity to maintain it into the near future the paper addresses practical questions about the strategies motives and benefits behind the current trends in particular we seek to evaluate the capacity of both china s and india s national innovation systems to internalize the potential returns of this increasing demand for ipr the insight reached finds that should both china and india sustain their current ipr growth rates they will be able to catch up with the most advanced economies within the time span of a few decades

quid pro quo foreign investment and welfare a political economy theoretic model abstract the classic paper by brecher and diaz alejandro 1977 analyzed the implications of tariff jumping direct foreign investment dfi induced by the imposition of an import tariff we analyze a new type of dfi where it occurs with a view to defusing not circumventing protection or rather the threat of protection by the host country an example is the dfi by japan in the united states the decision about the level of foreign investment is taken in the first of a two period horizon period this together with the level of exports in the first period determines the probability of a quota on exports being imposed in the second period policy makers aware of the effects of the first period decisions on the second period will impose an optimal tariff and an optimal tax subsidy on capital exports

water demand under alternative price structures we estimate the price elasticity of water demand with household level data structurally modeling the piecewise linear budget constraints imposed by increasing block pricing we develop a mathematical expression for the unconditional price elasticity of demand under increasing block prices and compare conditional and unconditional elasticities analytically and empirically we test the hypothesis that price elasticity may depend on price structure beyond technical differences in elasticity concepts due to the possibility of endogenous utility price structure choice observed differences in elasticity across price structures may be due either to a behavioral response to price structure or to underlying heterogeneity among water utility service areas

a proposition on short run departures from the law of one price unanticipated inflation relative price dispersion and commodity arbitrage abstract this paper proposes an explanation of short run departures from the law of one price based on the characteristics of the inflationary process and changes in the distribution of relative prices unexpected inflation gives rise to volatility of relative prices the more unexpected and hence uneven the rate of inflation the greater the difficulty in discerning from a given structure of relative prices commodity arbitrage opportunities which may be expected to persist and those transient opportunities which do not warrant a firm s incurring fixed costs of arbitrage an illustration portrays a risk averse firm confronting an international arbitrage opportunity

is knowledge power knowledge flows subsidiary power and rent seeking within mncs in recent years as multinational corporation mnc subsidiaries have become more closely linked to international networks their knowledge intensity has risen and some of their r d has gained a more creative role simultaneously and often connectedly many subsidiaries have acquired considerable strategic independence in all aspects of their operations and therefore are able to exercise considerable intra firm bargaining power to influence the distribution of the firm s resources in this context we suggest that intra mnc knowledge flows are a key determinant of subsidiary bargaining power we argue that subsidiary managers can exploit such power to pursue their own ends such rent seeking behavior is implicit in much of the literature on managerialism but our analysis suggests that such behavior can now occur in headquarters subsidiary and subsidiary subsidiary relations thus subsidiary strategic independence designed to enhance the competitiveness of outputs market knowledge and inputs asset seeking and learning can be corroded when the pursuit of subsidiary objectives encourages rent seeking empirical analysis of a sample of high technology subsidiaries in the uk provides strong support for the theory we examine several avenues whereby the incentives of units within the mnc can be aligned

the globalization of r d results of a survey of foreign affiliated r d laboratories in the usa abstract this paper examines the globalization of innovation and the phenomenon of foreign direct investment fdi in research and development to do so it draws from a survey of foreign affiliated r d laboratories in the united states while the literature on foreign direct investment has emphasized the role of markets in driving off shore investments the main conclusion of this research is that the globalization of innovation is driven in large measure by technology factors of particular importance is the objective of firms to secure access to scientific and technical human capital

unit tax versus ad valorem tax a tax competition model with cross border shopping abstract within the framework of spatial tax competition with cross border shopping we examine the choice of tax method between ad valorem tax and unit specific tax this study shows that governments endogenously choose the ad valorem tax method not because of a classic welfare reason but because it is a good strategy to compete for mobile consumers another key finding is that while governments are committed to the ad valorem tax method the choice leads to inferior outcome tax cutting competition becomes more serious when countries adopt ad valorem tax and competition in ad valorem tax results in smaller tax revenue than competition in unit tax

environmental regulation induced foreign direct investment the last decade has witnessed a renewed interest in the relationship between environmental regulations and international capital flows however empirical studies have so far failed to find conclusive evidence for this so called pollution haven or race to the bottom effect where foreign direct investment fdi is assumed to be attracted to low regulation countries regions or states in this paper we present a simple theoretical framework to demonstrate that greater stringency in environmental standards can lead to a strategic increase in capital inflows which we refer to as environmental regulation induced fdi our result reveals a possible explanation for the mixed results in the empirical literature and provides an illustration of the conditions under which environmental regulations in the host country can affect the location decision of foreign firms

innovation systems and inertia in r d location norwegian firms and the role of systemic lock in abstract this paper seeks to enquire why firms ceteris paribus tend to concentrate their r d activities at home using a systems of innovation si approach we argue that r d inertia is associated with structural inertia and resultant systemic lock in interaction within an si is a self reinforcing mechanism which may or may not lead to ex post efficiency lock in can be efficient when technologies and institutions maintain the competitiveness of firms on the other hand radical innovations or technological discontinuities may require new institutions and resources but systemic lock in may prevent rapid reaction firms can use a voice strategy by intervening to modify the appropriate institutions in the existing si or an exit strategy by seeking alternative si which more closely fit their needs in the case of norway two groups of firms exist group a benefit from a systemic lock in these are large firms in traditional sectors which are highly embedded and around whom the norwegian si has been built these firms engage in voice and loyalty group b are in science based sectors for whom lock in results in inefficiencies and use exit slowly expanding r d abroad to seek competences in technologies not available domestically

price and income elasticities of residential water demand a meta analysis this article presents a meta analysis of variations in price and income elasticities of residential water demand meta analysis constitutes an adequate tool to synthesize research results by means of an analysis of the variation in empirical estimates reported in the literature we link the variation in estimated elasticities to differences in theoretical microeconomic choice approaches differences in spatial and temporal dynamics as well as differences in research design of the underlying studies the occurrence of increasing or decreasing block rate systems turns out to be important with respect to price elasticities the use of the discrete continuous choice approach is relevant in explaining observed differences

change in domestic network centrality uncertainty and the foreign divestment decisions of firms abstract we investigate the role of domestic interfirm networks for the foreign divestment decisions of firms we argue that firms foreign operations risk being divested when a firm becomes more central in its domestic network positive changes in firm centrality at home facilitate access to information about new business opportunities but they may also lead firms to consider reconfiguring their value chain activities and resources across locations the resulting opportunity costs of maintaining foreign operations could subsequently lead to their divestment moreover we argue that the positive association between an increase in firm centrality in the domestic network and foreign divestment is stronger under higher uncertainty as pursuing new business opportunities at home becomes more appealing we distinguish between firm specific uncertainty and domestic market uncertainty we test and get support for our hypotheses using foreign subsidiary data from u s firms in the ict industry

sprayed to death path dependence lock in and pest control strategies theoretical literature on the economics of technology has emphasized the effects on technological trajectories of positive feedbacks in a competition among technologies that all perform a similar function the presence of increasing returns to adoptions can force all but one technology from the market furthermore the victor need not be the superior technology this paper provides an empirical study of one technological competition which illuminates this theoretical work it uses theoretical results to explain why chemical control of agricultural pests remains the dominant technology in spite of many claims that it is inferior to its main competitor integrated pest management copyright 1996 by royal economic society

the dynamics of innovation from national systems and mode 2 to a triple helix of university industry government relations abstract the triple helix of university industry government relations is compared with alternative models for explaining the current research system in its social contexts communications and negotiations between institutional partners generate an overlay that increasingly reorganizes the underlying arrangements the institutional layer can be considered as the retention mechanism of a developing system for example the national organization of the system of innovation has historically been important in determining competition reorganizations across industrial sectors and nation states however are induced by new technologies biotechnology ict the consequent transformations can be analyzed in terms of neo evolutionary mechanisms university research may function increasingly as a locus in the laboratory of such knowledge intensive network transitions

large firms in the production of the world s technology an important case of non globalisation us patenting by 686 of the world s largest manufacturing firms shows that their share of the world s production of technology is less than their share of r d activities and varies greatly amongst sectors in most cases the technological activities of these large firms are concentrated in their home country the characteristics of which influence the volume and trends in their technological activities much more strongly then the international component of these activities at the same time these large firms are major elements in the volume and the pattern of sectoral specializations in their home countries technological activities

institutional impact of foreign direct investment in china summary we provide firm level empirical evidence that the presence of foreign direct investment fdi has positively affected the institutional quality of the host regions in china specifically chinese domestic firms located in regions with a higher level of fdi tend to enjoy a lower level of tax and fee burdens less arbitrariness in such burdens as well as better legal protection to address the potential issue of endogeneity we adopt the instrumental variable approach in addition we explore the specific mechanisms through which the institutional impact is materialized and provide various extensions of the empirical findings that offer further support for the fdi induced institutional improvement argument

uneven domestic knowledge bases and the success of foreign firms in the usa this paper investigates the effect of within country and across country inequalities on firms fdi performance and finds drivers of success in an advanced host economy the usa differ for firms from developed compared to developing countries returns to fdi for firms from developed countries are significantly correlated with home countries level of economic development in contrast successful developing country firms are from countries with lower within country inequality and reflect the industrial structure associated with developing countries they are concentrated in scale intensive industries and benefit especially from capital investment the findings suggest that fdi reflects rather than disrupts unevenness in knowledge bases globally

multinational firms political competition and international trade policy this paper considers how the presence of multinational firms influences international trade policy that is determined as the outcome of political competition multinational firms have plants to protect in all policy jurisdictions and hence are more protectionist than national firms that at least have an interest in free trade in export markets nonetheless because of changed incentives for firms to provide political support for free trade and protectionist candidates an increased multinational presence via either merger or direct foreign investment has a liberalizing influence on trade policy copyright 1993 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association