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Technology spillovers from foreign direct investment (FDI): the active role of MNC subsidiaries in Argentina in the 1990s
journal contributionposted on 2023-06-08, 08:13 authored by Anabel MarinAnabel Marin, Martin Bell
The usual perspective on technology spillovers from FDI sees the MNC subsidiary as a passive actor. It presumes that the technological superiority that spreads from subsidiaries to other firms in the host economy is initially created outside it by MNC parent companies, and is delivered to subsidiaries via international technology transfer. The role of subsidiaries is little more than to act as a ‘leaky container’ lying between the technology transfer pipeline and the absorption of spillovers by domestic firms. This paper suggests a different model in which a substantial part of the potential for spillover is created within local subsidiaries as a result of their own knowledge-creating and accumulating activities in the host economy. We explore empirically the effects of these activities on technology spillovers from FDI using data for industrial firms in Argentina over the period 1992–96. The analysis suggests that significant results can be obtained incorporating subsidiaries' own technological activities as an explanatory variable of the spillover process.
JournalJournal of Development Studies
PublisherTaylor and Francis
Department affiliated with
- SPRU - Science Policy Research Unit Publications
NotesThe conventional view of the local subsidiaries as passive recipients of technology spillovers from the parent HQ is rejected in this study of foreign direct investment in Argentina, which demonstrates by using enterprise-level data that local technology activity by the subsidiaries themselves can make all the difference to the success of the `spillover¿. Dr Marin did the basic research and planning of the paper.
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