Multinational Companies and Technology Spillovers
Choi, Hyelin | January 2016
Abstract
Governments provide a variety of incentives such as lower in-come taxes, tax holidays, import duty exemptions, and subsidies to attract foreign firms into their country based on the belief that multinational companies (MNCs) bring benefits to the host country. Among the benefits, technology transfer and the productivity growth of domestic firms are the most anticipated by policy-makers. For example, Mauritius and Bangladesh experienced a sharp increase in exports in their respective textile sectors upon the entry of multinational firms. Considering that export companies are more productive than non-export companies, the presence of MNCs within the territory may contribute to the productive growth of domestic firms. Multinational firms - enterprises that manage production establishments which span two or more countries - are well known to be larger and more productive than domestically-owned firms. Since they own their superior assets and modern technology, they can cope with high fixed costs when establishing foreign affiliates and pioneering new markets. The entry of foreign firms with modern technology into the host country may incur intended and unintended technology spillovers to the host country's domestic firms, and hence, reduce their average cost of production and increase productive efficiency.
Citation
Choi, Hyelin. 2016. Multinational Companies and Technology Spillovers. © Korea Institute for International Economic Policy. http://hdl.handle.net/11540/10535.Keywords
Mass media and business
Microelectronics industry
Electronic industries
Digital electronics
Microelectronics
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Political Leadership
Public Administration
Business Ethics
Electronic Government
Online Government
Assessing Corporate Governance
Corporate Governance Reform
Governance Models
Commerce and Industry
Intra-Industry Trade
Large Scale Industry
Labor
Technical Evaluation
Government
Institutional Framework
Public Administration
Business Ethics
Political Leadership
Institutional Framework
Business Management
Corporate Restructuring
Industrialization
Industrial Economics
Industrial Development
Industrial Policy
Technology assessment
Technological institutes
Employment
Information Media
Mass Media
Export Oriented Industries
Electronics
Computers
Telecommunications Industry
Manufacturing Industries
Microprocessors
Electronic Equipment
Communication Industry
Blockchain Technology
Cyber Security
Mass media and business
Microelectronics industry
Electronic industries
Digital electronics
Microelectronics
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Civil government
Common good
Federal government
Delivery of government services
Government missions
Personnel management
Corporate reorganizations
Intergovernmental cooperation
Consolidation and merger of corporations
Industrial Mergers
Corporate Mergers and Acquisitions
Mergers
Microelectronics industry
Electronic industries
Digital electronics
Microelectronics
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Capital market
Developing countries
Market share
Labor
Technology transfer
Innovation
Financial Transfer
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