Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/55873
Authors: 
García-Vega, María
Hofmann, Patricia
Kneller, Richard
Year of Publication: 
2012
Series/Report no.: 
CESifo working paper: Trade Policy 3751
Abstract: 
This paper considers the effect of acquisition FDI on the knowledge production function. We distinguish between acquisitions by MNEs from technologically leading countries and those behind the technological frontier. We show that both acquire similarly R&D intensive domestic firms, but there are important differences post-acquisition. Acquisitions from technologically intensive countries reduce domestic R&D effort, in favour of an increase in foreign technology transfers, which suggests complementarities in the knowledge assets of the MNE and the target firm as a reason for FDI. In contrast, consistent with technology sourcing FDI, acquisitions from non-leading countries increase internal R&D efforts.
Subjects: 
MNE
knowledge production function
acquisition FDI
knowledge complementarities
technology sourcing
JEL: 
F23
O33
D22
L20
Document Type: 
Working Paper

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