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Outsourcing: Volume and Composition of R&D

Outsourcing: Volume and Composition of R&D This paper examines the impact of the outsourcing of production on the volume and composition of the home country's research and development (R&D). We find that outsourcing decreases the process R&D of the multinational firm in large markets when it only conducts process R&D (the substitution effect between outsourcing and process R&D). Outsourcing tends to emerge as a complementary factor to product development when the multinational firm conducts both product R&D and process R&D (the complementary effect between outsourcing and product R&D) under some conditions. This implies that international outsourcing has a different effect on product innovation and process innovation. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of International Economics Wiley

Outsourcing: Volume and Composition of R&D

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References (41)

Publisher
Wiley
Copyright
© 2012 Blackwell Publishing Ltd
ISSN
0965-7576
eISSN
1467-9396
DOI
10.1111/j.1467-9396.2012.01058.x
Publisher site
See Article on Publisher Site

Abstract

This paper examines the impact of the outsourcing of production on the volume and composition of the home country's research and development (R&D). We find that outsourcing decreases the process R&D of the multinational firm in large markets when it only conducts process R&D (the substitution effect between outsourcing and process R&D). Outsourcing tends to emerge as a complementary factor to product development when the multinational firm conducts both product R&D and process R&D (the complementary effect between outsourcing and product R&D) under some conditions. This implies that international outsourcing has a different effect on product innovation and process innovation.

Journal

Review of International EconomicsWiley

Published: Sep 1, 2012

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