Silviase/jgov_v1.4_full_ann huggingface dataset:
## 学校施設の効率的マネジメント

施設の「実態把握」・「評価」・・・「学校施設実態調査事業」による「施設の実態把握」「データベース化」整備計画の策定

①既存学校施設再生整備

②安全で快適な教育環境整備

③長寿命化やコスト平準化のための予防型保全手法の導入

トイレ改修やエレベータ設置等、特にニーズの高い個別の重点課題に優先的に対応するための改修事業

トイレ改修計画の推進（3～4 箇所 / 校）

## ○ 「狭い・暗い」対策

・児童生徒によるデザイン（サイン、壁タイル、ブースの色彩など）

・児童生徒の憩いの場となるよう、ベンチや全身鏡を設置

・プライバシーを考慮し、個室の壁を天井まで設置

・環境に配慮し、ブースごとのLEDダウンライト、人感センサー付き照明、自動水栓の採用

☐ 「臭い、汚い」対策

・床の清掃がしやすいように、受け部が低い（低リップ）壁掛け式小便器の採用

・汚垂（おだれ）石（汚れやにおいの染み付きを防ぐために張る石）の設置

## ○改修後の学校の声・効果など

・ワークショップへの参加、子どものデザインの採用などにより、愛着を持って使用している。

・ていねいに使用するようになり、古いトイレも含め、よく掃除をするようになった。

・トイレ改修の効果が学校全体に波及し、学校全体がきれいになったと保護者からほめられる。

・改修前は、トイレが暗く、特に低学年児童がこわがっていたが、明るく使いやすくなった。

・節水の意識が生まれた。

▲プライバシーを考慮した個室間仕切り（菅中学校）

▲憩いの場となる手洗い、ベンチ周り（左：有馬小学校、右：下作延小学校）

▲改修後の和便器・洋便器（下作延小学校）

▲低リップ壁掛け式小便器と污垂(おだれ)石のある男子トイレ<上は改修前>（有馬小学校）
## 安価で簡易なトイレ改修の提案（NPO法人日本トイレ研究所）

## 【取組概要】

● トイレを明るく安心して行ける空間に変える(簡易改修)と同時に、トイレを大切に使うことを伝える(出前事業)ことを目的に、「小学校のトイレぴかぴか計画」を展開。

## 【改修手法】

☑ 便器、トイレブース等の既存設備を可能な限り活用し、におい除去、明るい雰囲気作りを目指す簡易改修。改修経費は、1 フロアー 1 箇所あたり 150 万円～ 200 万円程度(男女各 1 便器の洋式化を含む)。

● 具体的には、既存床タイルの上からモルタルを敷き、レベル調整(段差解消含む)を行った上で、長尺シートを施工することで臭気対策を徹底。必要に応じ、トイレブースにシートフィルムを施工。

## 留意点

・においの原因は、床タイルの目地以外にも考えられるため、改修・対策方法については、十分な検討が必要。

・「既存トイレブース内のスペースが狭い」、「小便器の間隔が狭い」などといった、既存トイレが有する平面的課題についての対策は、別途検討が必要。

## 【整備事例】

▲出前事業の様子

▲マナーアップシール

～トイレマナーの習得や明るい雰囲気の演出～

## ■实施校

1. 岩手県・遠野市立土淵小学校

2. 宮城県・仙台市立東六番丁小学校

3. 東京都・目黒区立向原小学校

4. 静岡県・富士宮市立東小学校

5. 岐阜県・高山市立久々野小学校

6. 愛知県・一宮市立今伊勢小学校

7. 京都府・京都市立洛央小学校

8. 兵庫県・神戸市立菅の台小学校

9. 愛媛県・松山市立さくら小学校

10. 鳥取県・倉吉市立西郷小学校

11. 福岡県・直方市立直方南小学校

12. 鹿児島県・鹿児島市立中山小学校

13. 神奈川県・川崎市立旭町小学校

## 専門業者によるメンテナンス等（各地の教育委員会、学校での取組）

床面の水垢・黒ずみ対策やにおいの除去等に関しては、適切なメンテナンスで対応することも有効。

## 【においの発生源とメンテナンスの例】

● 床面の尿石・黒ずみ・・・メタクリル樹脂コーティングやガラスコーティングを施すことによる尿石や汚れの再付着の防止。

● 小便器の尿石・・・専門業者による薬品洗浄。さらに、後付自動センサーの設置による尿石予防。

● 排水トラップの損傷・・・トラップの補修などによる臭気逆流防止対策。

床面のメタクリル樹脂コーティング

床面のガラスコーティング
## 長期メンテナンス契約による予防型維持管理（大阪府箕面市教育委員会）

## 【取組概要】

においの原因となる尿石の除去等を長期契約により定期的に実施し、コストを縮減。

● 平成 22 年度に実施した域内全小中学校のトイレ改修と併せ、計画的・継続的に、常に快適性の高いレベルのトイレ環境を維持。

● 各学校の状況をよく把握した専門業者による清掃及びアドバイス。

## 【委託概要】

現在、平成20年4月から平成25年3月までの5年間にわたる小中学校便所防臭管理委託契約の期間中。

● 市内 22 小中学校のうち、小中一貫校として新築・移転した 2 校(延べ 4 校)を除く、18 校を一括した委託契約。

2ヶ月に1回の尿石除去や水垢の除去等のみならず、学校における便所の美化活動推進のために、専門業者としての適切な助言・資料の提供等を委託。

## <業務內容>

○尿石の除去

○つまりの解消

○水垢・黒ずみの除去

○金属部分（フラッシュバブル等）の清掃

☐便器周辺(床・壁)等の洗浄

☐確認・調整

○故障箇所の報告 等

## 定期的なメンテナンスの効果（イメージ）

尿石がたまるごとに除去を行なう場合

定期的なメンテナンス

2ヶ月に一度簡単なメンテナンスを行なう場合

汚れの蓄積が少ないうちにメンテナンスを行うことで、トータルコストの低減が図れるとともに、常に快適な状態の維持が可能。

## （参考）箕面市における学校トイレに対するその他の取組

## <平成22年度に域内全小中学校のトイレ改修を実施>

○環境への配慮（蛍光灯からLEDへの変更、自動水栓による節水、トイレ用擬音装置の設置）

○床を湿式から半乾式(非常時には排水可)へ

☐ 和式便器の一部を洋式化

※本改修により、尿石除去の必要頻度が減り、

月１回から２ヶ月に１回に変更

## <「トイレの使い方」保健指導>

○トイレの改修に併せ、「つぎにつかう人、そうじをする人のきもちを考える」等を指導

▲保健指導（南小学校）
# 「学校トイレ改修事例集」作成協力者

海野 剛志 川崎市教育委員会事務局教育環境整備推進室長

加藤 篤 NPO法人日本トイレ研究所代表理事

小林 純子 設計事務所ゴンドラ代表（日本トイレ協会理事）

齋藤 登 葛飾区教育委員會施設課長

◎長澤 悟 東洋大学理工学部教授

松本 心一 世田谷区立緑丘中学校校長

村上八千世 アクトウェア研究所代表

<◎ 主查>

(特別協力者)

新保 幸一 国立教育政策研究所文教施設研究センター長

(オブザーバー)

大臣官房文教施設企画部施設助成課

初等中等教育局児童生徒課

スポーツ・青少年局学校健康教育課

(事務局)

大臣官房文教施設企画部施設企画課

## column 〜改修仕様の検討

## 洋式or和式

従来、学校トイレは、大便器のほとんどが和式となっている。一方、近年、各家庭や商業施設等において洋式化も進んできている。

学校トイレについて、アンケートをとると洋式化を望む声も聞かれ、改修にあわせ和式と洋式の設置比率が見直されてきている。その比率をどのように設定していくかは、一つの検討課題とされている。

便器については、学年が上がるにつれ、人の座った便座に座ることに抵抗を感じるという強い声も聞かれたり、和式の使い方を学校において学ばせるべきとの考えも存在したりする。また、怪我をしていてしゃがめないので洋式が必要な利用者もいる。

学校施設は、学校開放などにより、学内外の多くの人々が利用することに配慮することも必要である。改修時の和式と洋式の設置比率については、それぞれの特徴を考慮し、利用者の声をよく聞くとともに、どう運用していくかなどを十分検討した上で、各設置者・学校において、適切に決定していくことが望まれる。

## ☆乾式or湿式

従来の学校トイレは、水を流して清掃できる湿式の床が一般的であるが、改修にあたって乾式化する学校も増えている。

乾式の床は、清掃の水が残らないので清潔感があるという声が聞かれる。一方で、湿式の床は、特に便器外排泄や嘔吐の際に水で流せる利点があるとの声も聞かれる。

いずれの方式の床であっても、それぞれ適した清掃方法があり、それらの特徴をよく理解し、必要に応じ専門業者のアドバイスを受けつつ、適切な清掃を行うことが必要である。改修の際は、清掃方法を理解した上で、湿式・乾式を選択することが必要である。

なお、通常時は乾式とし、特に汚れた場合や汚れやすい部分は、水を流して洗えるように計画することも有効である。和便器周りのみ水で流せるように防水仕上げとして排水溝を設けたり、乾式部分との間に排水用の溝を設けたりするなどが考えられる。
きれいに保とうと

心がけるようになった。

明るくなった。

においがなくなった。

のぞかれる心配がなくなり、

落ち着ける。

自慢できる。

普通に入りやすくなった。

きれいなトイレを

大事に使っていきたい。

きれいで、明るくて、楽しい。

とにかくうれしい。

掃除をする意欲がわいてくる。

自分たちが考えたトイレで、

愛着がわく。

一人で行ける。
文部科学省
ESRI Discussion Paper Series No.132

Overseas R&D Activities by Japanese

Multinational Enterprises: Causes, Impacts, and

Interaction with Parent Firms

by

Yasuyuki Todo and Satoshi Shimizutani

March 2005

Economic and Social Research Institute

Cabinet Office

Tokyo, Japan
# Overseas R&D Activities by Japanese Multinational Enterprises: Causes, Impacts, and Interactions with Parent Firms $ ^{*} $

Yasuyuki Todo $ ^{\dagger} $

Satoshi Shimizutani $ ^{\ddagger} $

March, 2005

## Abstract

This paper investigates determinants and impacts of R&D activities in overseas subsidiaries, using firm-level panel data for Japanese multinational enterprises. We distinguish between overseas innovative and adaptive R&D according to survey responses and find substantial differences between the two types of R&D. Most importantly, evidence suggests that overseas innovative R&D targets the exploitation of foreign advanced knowledge, successfully takes it to parent firms, and raises home productivity. By contrast, the primary role of overseas adaptive R&D is to contribute to productivity in the host country with the use of knowledge of parent firms. In addition, we find no complementarity between home and overseas innovative R&D, i.e., no evidence that overseas innovative R&D raises the marginal effect of home R&D on home productivity.

Keywords: overseas R&D activities, multinational enterprises, total factor productivity.

JEL classifications: F23, O30.

$ ^{*} $ This research was conducted as part of a project on Japanese economic growth undertaken by the Economic and Social Research Institute (ESRI), the Cabinet Office of the government of Japan. The authors thank René Belderbos, Hiroyuki Chuma, Kyoji Fukao, Tomoko Iwasa, Yutaka Kosai, Hyeog Ug Kwon, Colin McKenzie, Keiko Murata, Hiroyuki Odagiri, Ryuhei Wakasugi, Hideto Yasuda, and seminar participants at the ESRI, Hitotsubashi University, and Keio University for helpful comments and suggestions. Todo is grateful to the Japan Society for the Promotion of Science (Grant-in-Aid for Scientific Research) and the Masayoshi Ohira Memorial Foundation for financial support. The opinions expressed and arguments employed in this paper are the sole responsibility of the authors and do not necessarily reflect those of the ESRI or the Cabinet Office of the government of Japan.
## 1 Introduction

Overseas R&D activities by multinational enterprises (MNEs) have expanded significantly in magnitude in recent years (Kuemmerle, 1999; Granstrand, 1999; Patel and Vega, 1999; Pearce, 1999; Pearce and Papanastassiou, 1999; Le Bas and Sierra, 2002). The literature also indicates that there are two types of overseas R&D, one for utilization and acquisition of foreign advanced knowledge that would be otherwise unavailable in the home country, $ ^{1} $ and the other for adaptation of existing technologies and products to local conditions of the host country. We will hereafter denote the former type of overseas R&D as innovative R&D and the latter as adaptive R&D. $ ^{2} $

Depending on the type of overseas R&D, its determinants and impacts on productivity of parent firms and overseas subsidiaries may vary. For example, innovative R&D is likely to be performed in technologically advanced countries, whereas adaptive R&D may be more closely related with the market size of the host country than with its technology level. In addition, innovative R&D may have positive impacts on the productivity of parent firms, but we expect no impact of adaptive R&D on home productivity. However, differences between the two types of overseas R&D are often ignored in the existing literature on its determinants and impacts. $ ^{3} $ Thus, the present paper examines determinants and impacts of each type of overseas R&D to highlight differences between the two types, using firm-level panel data for Japanese parent firms and their overseas subsidiaries in R&D-intensive manufacturing industries during the period 1996-2001. An advantage of the data sets used in this paper is that we can classify R&D activities of each overseas subsidiary as innovative or adaptive R&D according to its survey responses.

Our findings clearly indicate wide discrepancies between overseas innovative and adaptive R&D. First, the size of overseas innovative R&D is larger when the total factor productivity (TFP) of the host country is larger, whereas the size of adaptive R&D is unrelated to the TFP level. Second, overseas innovative R&D improves TFP growth in parent firms as much as home R&D does. However,
overseas adaptive R&D has no impact on home TFP growth. Finally, innovative R&D in overseas subsidiaries does not improve their own TFP growth in the host country, whereas their adaptive R&D has a positive effect.

These results suggest that overseas innovative R&D mostly targets the exploitation of foreign advanced knowledge, successfully takes it to parent firms, and consequently raises productivity in Japan. By contrast, the primary role of overseas adaptive R&D is to contribute to productivity in the host country by utilizing knowledge of parent firms, rather than knowledge of the host country.

In addition, we examine whether overseas innovative R&D interacts with home R&D, or, more specifically, whether it raises the marginal effect of home R&D on home productivity growth. We denote this relation, which has not been quantitatively examined in the existing literature, as complementarity between home and overseas innovative R&D. Using the interaction term between home and overseas innovative R&D, we find no evidence of complementarity. It is thus suggested that parent firms and overseas subsidiaries perform R&D independently without close interaction with each other. This conclusion is supported by survey responses from Japanese MNEs (Kiba, 1996) and interviews with managers of Japanese MNEs in the United States (Tanaka et al., 2000) which in fact report weak interaction between home and overseas R&D.

Our analysis is built on numerous existing studies on R&D. First, this paper is most closely related to Iwasa and Odagiri (2004), who investigate impacts of R&D performed in Japan and the United States by Japanese MNEs on the magnitude of innovation in the two countries. They distinguish between the two types of overseas R&D as we do in this paper, using similar data to ours. Major differences between their study and ours are that they measure the output of innovative R&D by patent applications whereas we measure it by TFP growth and that they do not examine determinants of overseas R&D. In addition, they limit their analysis to Japanese MNEs in the United States, whereas our samples include MNEs around the world. Second, there are a number of works on impacts of own R&D at the firm level, originated by Griliches (1980) and summarized in Mairesse and Sassenou (1991) and Griliches (1998). Fors (1997) extends these works to examine impacts of overseas R&D on productivity growth of parent firms, using Swedish firm-level data. Third, some studies
examine determinants of overseas R&D, using Japanese firm-level data (Oda-giri and Yasuda, 1996; Belderbos, 2001) and industry-level data for the United States and Japan (Kumar, 2001). It should be noted, however, that with the exception of Iwasa and Odagiri (2004), all the studies cited above fail to distinguish between innovative and adaptive R&D. Moreover, all of them ignore complementarity between home and overseas R&D.

Finally, our work is also related to Branstetter (2000) who finds that foreign direct investment stimulates knowledge flows from and to the host country, using firm-level patent citation data. Our results also show indirect evidence of knowledge diffusion from the host country to parent firms through overseas R&D, since we find a positive effect of overseas innovative R&D on home productivity. However, the degree of the knowledge diffusion may not be large, since we also find that overseas R&D does not improve the marginal effect of home R&D.

The rest of the paper is organized as follows. Section 2 presents the theoretical framework to generate estimation equations, which are presented in Section 3 together with estimation methods. Data and variables are explained in Section 4, whereas Section 5 reports estimation results and compares them with results in the existing literature. Section 6 concludes.

## 2 Theoretical Framework

Our estimation equations are derived from the profit maximization behaviors of MNEs that improve the quality of their products using home and overseas R&D activities. Characteristics of quality improvement are similar to those in quality-ladder growth models. We assume two countries, Home and Foreign, without international trade of goods. Home is an advanced country in which parent firms have production sites, and Foreign can be either an advanced or a less advanced country in which subsidiaries of the parent firms are in operation.

We assume that any firm in either Home or Foreign has a monopoly power over its product for one period after improving the quality of the product through R&D activities. Thus, each firm determines its output and price to maximize its profits from production, given the demand for its product. Since the demand is assumed to be increasing in both the quality of the product and
aggregate market size, the production profits are also increasing in these two variables. Thus, we assume that the production profits for parent firm i in Home and for its subsidiary in Foreign in period t are given by $ \pi_{it}^{p}=A_{it}^{p}y_{t}^{p} $ and $ \pi_{it}^{s}=A_{it}^{s}y_{t}^{s} $ , respectively. $ A_{it}^{p} $ and $ A_{it}^{s} $ are the quality of good i that is achieved by the parent firm in Home and its subsidiary in Foreign, respectively, in period t, whereas $ y_{t}^{p} $ and $ y_{t}^{s} $ represent the aggregate market size of Home and Foreign, respectively. We do not derive these from micro-founded behaviors for simplicity, but similar results are obtained in quality-ladder growth models such as those in Acemoglu et al. (2002) and Aghion and Howitt (2005). Although firm i produces the same good in the two countries, its quality may differ across countries due to costly international knowledge diffusion.

There are three types of R&D activity for quality improvement in Home and Foreign: R&D for innovation in Home and Foreign and R&D in Foreign for adaptation of existing technologies and products to local conditions of Foreign. $ ^{4} $ Each type differs in what knowledge stocks it utilizes and in which country it improves quality. First, innovative R&D in each parent firm employs its own knowledge and improves the quality levels in both its own and overseas subsidiary. This implies the presence of knowledge diffusion from the parent firm to its subsidiary through home R&D. Second, since innovative R&D in each overseas subsidiary is preformed to exploit advanced knowledge that is publicly available in Foreign but not in Home, it utilizes the public knowledge of Foreign, rather than its own firm-specific knowledge. $ ^{5} $ We assume that without overseas innovative R&D, firms in Home have no access to Foreign's knowledge. Through the exploitation of foreign knowledge, innovative R&D in the subsidiary leads to quality improvement in both its parent firm and the subsidiary. Finally, adaptive R&D in each subsidiary in Foreign uses the knowledge of its parent firm and as a result, improves quality only in the subsidiary. It does not employ the public knowledge of Foreign, since it does not target the exploitation of foreign knowledge. Also, it does not employ firm-specific knowledge of the subsidiary, since we assume that more advanced knowledge of its parent firm can freely
diffuse through adaptive R&D.

More specifically, we assume the following quality improvement functions:

$$ A_{i,t+1}^{p}-A_{i t}^{p}=\delta^{p}f\left(A_{i t}^{p}\cdot R\&D_{i t}^{p},A_{i t}^{h o s t}\cdot R\&D_{i t}^{s I}\right)(A_{i t}^{p})^{-\phi}, $$

$$ A_{i,t+1}^{s}-A_{i t}^{s}=\left(\delta^{s}f\left(A_{i t}^{p}\cdot R\&D_{i t}^{p},A_{i t}^{h o s t}\cdot R\&D_{i t}^{s I}\right)+\gamma^{s}(A_{i t}^{p}\cdot R\&D_{i t}^{s A})^{\lambda}\right)(A_{i t}^{s})^{-\phi}, $$

where $ \delta^{p}>0 $ , $ \delta^{s}>0 $ , and $ \phi\geq0 $ . $ R\&D_{it}^{p} $ denotes expenditures on R&D in parent firm i in Home in period t, whereas $ R\&D_{it}^{sI} $ , and $ R\&D_{it}^{sA} $ are expenditures on innovative and adaptive R&D in subsidiary i in Foreign, respectively. $ A_{it}^{p} $ , defined as the quality level in parent firm i, also represents its current knowledge level. $ A_{it}^{host} $ represents the public knowledge level in Foreign. The arguments of f indicate that the combination of research efforts $ (R\&D) $ and the current knowledge $ (A) $ raises quality levels, $ ^{6} $ assuming $ f_{1}>0 $ and $ f_{2}>0 $ . The last term in equations (1) and (2), $ (A_{it}^{p})^{-\phi} $ and $ (A_{it}^{s})^{-\phi} $ , indicate that as quality improves, further quality improvement becomes more costly due to exhaustion of ideas. Parameter $ \phi $ represents the magnitude of this “idea-exhaustion” effect.

Function f has two possible forms, depending on how innovative R&D in Home and Foreign interact with one another. Namely, innovative R&D in parent firm i may or may not raise the marginal effect of innovative R&D in its overseas subsidiary, and vice versa. If innovative R&D in the parent firm and subsidiary improves each other's marginal effect, or $ f_{12} $ , the cross derivative of f, is positive. We call this relation complementarity between home and overseas innovative R&D. Specifically, we assume a Cobb-Douglas form in the case of the complementarity:

$$ f(\bullet)=(A_{i t}^{p}R\&D_{i t}^{p})^{\alpha\lambda}(A_{i t}^{h o s t}R\&D_{i t}^{s I})^{(1-\alpha)\lambda}, $$

where $ 0 < \alpha < 1 $ and $ 0 < \lambda < 1 $ . Instead, if there is no complementarity, we assume

$$ f(\bullet)=\alpha(A_{i t}^{p}R\&D_{i t}^{p})^{\lambda}+(1-\alpha)(A_{i t}^{h o s t}R\&D_{i t}^{s I})^{\lambda}. $$

Each MNE performs home and overseas R&D in any period, since it would otherwise lose its monopoly power. Given the current knowledge levels in
Home and Foreign and equations (1) and (2), MNE i maximizes the sum of its monopoly profits from production in Home and Foreign less the total costs of R&D:

$$ \max_{\{R\&D_{it}^{p},R\&D_{it}^{sI},R\&D_{it}^{sA}\}}A_{i,t+1}^{p}y_{t+1}^{p}+A_{i,t+1}^{s}y_{t+1}^{s}-R\&D_{it}^{p}-R\&D_{it}^{sI}-R\&D_{it}^{sA}. $$

From the first-order conditions, it is not difficult to show effects of the exogenous variables on expenditures on innovative and adaptive R&D in Foreign. Signs of some of these effects are independent of whether or not home and overseas innovative R&D is complementary (i.e., f is given by equation [3] or [4]), as the following inequalities indicate:

$$ \frac{\partial R\&D_{it}^{sI}}{\partial A_{it}^{s}}\leq0,\quad\frac{\partial R\&D_{it}^{sI}}{\partial A_{it}^{host}}>0,\quad\frac{\partial R\&D_{it}^{sI}}{\partial y_{i,t+1}^{s}}>0, $$

$$ \frac{\partial R\&D_{it}^{sA}}{\partial A_{it}^{s}}\leq0,\quad\frac{\partial R\&D_{it}^{sA}}{\partial A_{it}^{host}}=0,\quad\frac{\partial R\&D_{it}^{sA}}{\partial y_{i,t+1}^{s}}>0,\quad\frac{\partial R\&D_{it}^{sA}}{\partial A_{it}^{p}}>0. $$

The first inequalities of (6) and (7) are derived from the idea-exhaustion effect. Namely, an increase in the quality level in subsidiary firms raises costs of further quality improvement and thus lowers overseas R&D expenditures, unless $ \phi = 0 $ , or there is no idea-exhaustion effect. The second inequalities of (6) and (7) indicate effects of the level of the public knowledge of Foreign. Its effect on overseas innovative R&D is positive, since an expansion of the public knowledge raises marginal gains from that type of R&D. However, its effect on adaptive R&D is zero, since the public knowledge is not an input to adaptive R&D. The third inequalities show that the market size of Foreign always has a positive effect on both innovative and adaptive R&D expenditures in Foreign, simply because gains from overseas R&D depend on the market size of the host country. The last inequality of (7) indicates that knowledge of parent firms has a positive impact on the size of overseas adaptive R&D, since it is the primary input to the adaptive R&D.

In contrast to these unambiguous effects, the effect of the knowledge level of parent firms, $ A_{it}^{p} $ , on overseas innovative R&D varies depending on whether home and overseas innovative R&D are complementary to one another. Under the presence of the complementarity, we obtain

$$ \frac{\partial R\&D_{it}^{sI}}{\partial A_{it}^{p}}\left\{\begin{array}{ll}>0&if\quad\alpha\lambda-\phi>0\\ <0&otherwise.\end{array}\right. $$
There are two forces that lead to this result: the idea-exhaustion effect in quality improvement in parent firms that lowers the effect of $ A_{it}^{p} $ on $ R\&D_{it}^{sI} $ , and complementarity between home and overseas innovative R&D that raises it. Therefore, the overall effect is positive if the elasticity of $ A_{it}^{p} $ , $ \alpha\lambda $ , is sufficiently large, and it is negative if the magnitude of the idea-exhaustion effect, $ \phi $ , is sufficiently large. By contrast, in the absence of complementarity, the idea-exhaustion effect dominates, and thus we have

$$ \frac{\partial R\&D_{it}^{sI}}{\partial A_{it}^{p}}\leq0, $$

where the equality holds when $ \phi = 0 $ . In summary, the effect of the knowledge level of parent firms on the size of overseas innovative R&D is positive, if home and overseas innovative R&D are complementary to one another and the idea-exhaustion effect is small.

## 3 Estimation Equations and Methods

We consider three sets of estimation equations to examine determinants of overseas R&D activities by Japanese MNEs and their impacts on productivity growth in parent firms and overseas subsidiaries.

### 3.1 Determinants of Overseas R&D Activities

Inequalities (6)-(8) lead to the following testable equation:

$$ \frac{R\&D_{ijt}^{sX}}{Y_{ijt}^{s}}=\beta_{1}^{X}\ln A_{it}^{p}+\beta_{2}^{X}\ln A_{ijt}^{s}+\beta_{3}^{X}\ln A_{jt}^{host}+\beta_{4}^{X}\ln Y_{jt}^{host}+\delta_{0t}^{X}+\delta_{1i}^{X}+\varepsilon_{ijt}^{X}, $$

for X = I, A, where $ R \& D_{ijt}^{sI} $ and $ R \& D_{ijt}^{sA} $ are expenditures on innovative and adaptive R&D in subsidiary i in country j in year t, respectively, and $ Y_{ijt}^{s} $ is its value added. $ ^{7} $ $ A_{it}^{p} $ and $ A_{ijt}^{s} $ are represented by the TFP levels of parent firm i and its subsidiary in country j, respectively. $ A_{jt}^{host} $ is the aggregate TFP level of country j, representing the public knowledge level of country j. $ Y_{jt}^{host} $ is GDP of country j in year t, indicating the market size for any good. This should be