Relevance, nature and economic effects of innovation activities of multinational corporations (MNCs) are highly debated topics in the current literature on “globalisation of technology”. A controversial theme concerns the innovation strategies of foreign affiliates (FAs) and the role they play in host countries. This paper sheds new light on this topic using data provided by the second Community Innovation Survey (CIS 2). In particular the paper aims at:assessing the technological contribution of FAs in a host country (i.e. Italy) by comparing the innovation performances and strategies of FAs and domestic firms; identifying and qualifying the main patterns of innovative activities of MNCs. The empirical evidence presented shows that FAs and domestic firms differ from each other more in terms of “type of innovation strategies” pursued by the firms than in terms of “innovation performances”. However, innovation strategies of FAs present a high degree of heterogeneity, being affected by the technological characteristics of industries, the specific technological assets of firms as well as by some peculiar features of the Italian innovation and production systems, namely its specialisation in traditional goods and mechanical engineering combined with its weakness in the science-based sectors. Three distinct innovation patterns of FAs have been identified and labelled respectively as “low-tech” “adaptive” and “asset seeking”. These patterns differ on the basis of the overall commitment of FAs to innovation, the sources and objectives of the technological activities undertaken, and according to the nature, strength and geographical horizon of technological links established with the external environment. Among the three, the “adaptive” pattern is by far the dominant one, while FAs following an "asset seeking” strategy are rare, and they are surprisingly lacking in high-tech sectors. The empirical findings presented in this paper, along with reflecting the structural features of the Italian industry and innovation system, highlight some more general stylised features of innovation strategies of FAs.

Global technology: innovation strategies of foreign affiliates in Italy

Evangelista Rinaldo
2005

Abstract

Relevance, nature and economic effects of innovation activities of multinational corporations (MNCs) are highly debated topics in the current literature on “globalisation of technology”. A controversial theme concerns the innovation strategies of foreign affiliates (FAs) and the role they play in host countries. This paper sheds new light on this topic using data provided by the second Community Innovation Survey (CIS 2). In particular the paper aims at:assessing the technological contribution of FAs in a host country (i.e. Italy) by comparing the innovation performances and strategies of FAs and domestic firms; identifying and qualifying the main patterns of innovative activities of MNCs. The empirical evidence presented shows that FAs and domestic firms differ from each other more in terms of “type of innovation strategies” pursued by the firms than in terms of “innovation performances”. However, innovation strategies of FAs present a high degree of heterogeneity, being affected by the technological characteristics of industries, the specific technological assets of firms as well as by some peculiar features of the Italian innovation and production systems, namely its specialisation in traditional goods and mechanical engineering combined with its weakness in the science-based sectors. Three distinct innovation patterns of FAs have been identified and labelled respectively as “low-tech” “adaptive” and “asset seeking”. These patterns differ on the basis of the overall commitment of FAs to innovation, the sources and objectives of the technological activities undertaken, and according to the nature, strength and geographical horizon of technological links established with the external environment. Among the three, the “adaptive” pattern is by far the dominant one, while FAs following an "asset seeking” strategy are rare, and they are surprisingly lacking in high-tech sectors. The empirical findings presented in this paper, along with reflecting the structural features of the Italian industry and innovation system, highlight some more general stylised features of innovation strategies of FAs.
2005
Istituto di Ricerche sulla Popolazione e le Politiche Sociali - IRPPS
Innovazione
Internazionalizzazione
Multinazionali
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/20.500.14243/62016
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