In Search of FDI–Transmitted R&D Spillovers: A Study Based on Swedish Data

In Search of FDI-Transmitted R& D Spillovers: A Study Based on Swedish Data. — This paper analyzes empirically whether inward and outward foreign direct investment (FDI) work as channels for international R&D spillovers. The authors utilize firm-level and industry-level data for Swedish manufacturing. Hardly any evidence of FDI-related R&D spillovers is found. But while the results do not provide support for the hypothesis that the activity level of MNEs’ affiliates matters for the extent of FDI-transmitted international spillovers, they suggest that utilizing foreign affiliates’ employment as a weighting scheme may be too crude a measure. The authors’ analysis shows indeed that the type of activity — R&D or assembly — carried out in the affiliates matters significantly for technology sourcing.