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Reverse international knowledge transfer in the MNE: (where) does affiliate performance boost parent performance?
journal contribution
posted on 2023-06-09, 02:28 authored by Nigel Driffield, James H Love, Yong YangWe examine the extent to which the knowledge or technological capability of foreign affiliates actually enhances the performance of their parent companies. Our results draw on a firm-level panel of more than 1600 multinationals and more than 4000 of their overseas affiliates, covering 46 home and host countries. We find considerable evidence of enhanced parent productivity as a result of their affiliates’ performance, which we interpret as evidence of reverse knowledge transfer from affiliates to parents. This effect is robust to different tests including IV estimation and a falsification exercise based on unconnected ‘matched’ affiliates. We find that both physical and strategic location markedly affects the affiliate-parent relationship, and that distance reduces the positive impact that affiliate performance has on that of the parent.
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Publication status
- Published
File Version
- Published version
Journal
Research PolicyISSN
0048-7333Publisher
ElsevierExternal DOI
Issue
2Volume
45Page range
491-506Department affiliated with
- Business and Management Publications
Full text available
- No
Peer reviewed?
- Yes
Legacy Posted Date
2016-08-10First Compliant Deposit (FCD) Date
2021-03-05Usage metrics
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