Tuesday, May 24
10am CT | 11am ET | 4pm GMT | 5pm CET
Disconnected research and development: The (temporary) spatial patterns of innovation
Kerstin Schaefer, LSE
Abstract: In Economic Geography, recent publications have revived the discussion on multisite firms as the main actors shaping local knowledge accumulation (Li and Bathelt, 2021) and pointed towards the underrated importance of inter-regional knowledge transfers within firms (Zhang and Rigby, 2021). In particular, the international expansion of firms from dynamically growing regions changes the mainstream direction of global knowledge flows that mainly used to occur between todays economically leading regions (Kuemmerle, 1999). Those firms now increasingly cause so-called “reverse knowledge-flows” from subsidiaries to headquarters, channeling knowledge flows towards their home markets by offshoring research activities to centers of state-of-the-art knowledge while keeping product development closer to home. We therefore aim to study the spatial dynamics in the strategical orchestration of knowledge creation.
Literature on R&D internationalization distinguishes between competence exploiting or home-base-exploiting and competence creating or home-base-augmenting motives (Cantwell and Mudambi, 2005; Kuemmerle, 1999). It claims that most offshore R&D starts out following competence exploiting motives while competence creating motives are added to the subsidiaries tasks later and only in some cases. By operationalizing these types of R&D activities, this study aims at understanding the dynamics of spatial (re-)organization of R&D in relation to firm development.
Because we still know too little about how R&D internationalization motives evolve, this study uses information from patents to build an indicator and a firm-typology revealing the global patterns of which type of R&D activity is performed at which locations. We aim at providing a quantitative measure for the type of R&D activity that goes beyond the qualitative observations often used to study this phenomenon. The indicator aims to reveal similarities and differences between the development of currently emerging firms and early activities of today’s global players. This can yield new evidence on innovation capability building and successful development trajectories in R&D internationalization. The findings provide a more profound understanding of the temporality of orchestrating global R&D activities, with implications for firms and the regional development of emerging as well as established markets.