The impact of internationalization on innovation at countries' level: The role of absorptive capacity

Journal article


Filippetti, A, Frenz, M and Ietto-Gillies, G. (2016). The impact of internationalization on innovation at countries' level: The role of absorptive capacity. Cambridge Journal of Economics. 41 (2), pp. 413-439.
AuthorsFilippetti, A, Frenz, M and Ietto-Gillies, G.
Abstract

© The Author 2016. This paper analyses the impact of internationalization on the innovation performance of 40 countries. Internationalization variables are represented by outward and inward foreign direct investment, and by imports and exports; innovation is proxied with triadic patent applications. We take account of the influence of absorptive capacity-in both a linear and non-linear form-in the relationship between internationalization and innovation. Our results suggest that outward FDI is positively associated with patenting. Countries with high absorptive capacity benefit more, though there are diminishing returns. We find there is a negative association between inward FDI and patenting in countries with low absorptive capacity where FDI may displace local infant activities and stun further development of related local knowledge. We find support for the view that the innovation performance of countries with low absorptive capacity benefits from imports as well as from exports.

KeywordsEconomic Theory; Applied Economics; Other Economics; Economics
Year2016
JournalCambridge Journal of Economics
Journal citation41 (2), pp. 413-439
PublisherLondon South Bank University
ISSN0309-166X
Digital Object Identifier (DOI)doi:10.1093/cje/bew032
Publication dates
Print15 Jul 2016
Publication process dates
Deposited08 Mar 2018
Accepted16 May 2016
Accepted author manuscript
License
CC BY 4.0
File Access Level
Open
Permalink -

https://openresearch.lsbu.ac.uk/item/87327

  • 4
    total views
  • 26
    total downloads
  • 2
    views this month
  • 2
    downloads this month

Related outputs

The organizational and geographical boundaries of the firm: Focus on labour as a major stakeholder
Ietto-Gillies, G. (2017). The organizational and geographical boundaries of the firm: Focus on labour as a major stakeholder. Critical Perspectives on International Business. 13 (1), pp. 72-92.
Are Innovation and Internationalization Related? An Analysis of European Countries
Filippetti, A, Frenz, M and Ietto-Gillies, G. (2011). Are Innovation and Internationalization Related? An Analysis of European Countries. Industry and Innovation. 18 (5), pp. 437-459.