Determinants of International R&D Outsourcing: The Role of Trade

García-Vega, María; Huergo, Elena

Abstract

This paper investigates the determinants of international R&D outsourcing, in particular the role of trade. We sketch a monopolistic competition model with heterogeneous firms where outsourcing increases a firm's fixed transaction costs as well as its productivity. Financial constraints affect the decision to outsource R&D more to nonexporters than to exporters. In contrast, exporters are more sensitive to a lack of information because they have higher losses when there is technology leakage. We test these predictions using a panel database of Spanish companies. The results highlight the relevance of information in competitive markets, and the role of trade to induce companies to engage in other globalization strategies.

Citation

García-Vega, M., & Huergo, E. (2011). Determinants of International R&D Outsourcing: The Role of Trade. Review of Development Economics, 15(1), 93-107. https://doi.org/10.1111/j.1467-9361.2010.00595.x

• Journal Article Type: Article
• Online Publication Date: Jan 13, 2011
• Publication Date: 2011-02
• Deposit Date: Sep 6, 2024
• Journal: Review of Development Economics
• Print ISSN: 1363-6669
• Electronic ISSN: 1467-9361
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• Volume: 15
• Issue: 1
• Pages: 93-107
• DOI: https://doi.org/10.1111/j.1467-9361.2010.00595.x
• Public URL: https://nottingham-repository.worktribe.com/output/39174640
• Publisher URL: https://onlinelibrary.wiley.com/doi/pdf/10.1111/j.1467-9361.2010.00595.x