DP4099 Technology Transfer and Spillovers in International Joint Ventures
|Author(s):||Thomas Müller, Monika Schnitzer|
|Publication Date:||October 2003|
|Keyword(s):||foreign direct investment, joint ventures, multinational enterprise, ownership structure, spillovers, transition economies|
|JEL(s):||D43, F21, F23, L13, O12, P31|
|Programme Areas:||Industrial Organization, International Trade and Regional Economics, Transition Economics, Institutions and Economic Performance|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=4099|
This paper analyzes the effects of a potential spillover on technology transfer of a multinational enterprise and on the host country policy. In particular, we examine how both parties? incentives can be controlled through the ownership structure in an international joint venture. In contrast to existing arguments, we show that spillovers must not always have negative effects on technology transfer and they may be efficiency-improving. Moreover, there are circumstances where a joint venture is mutually beneficial. Surprisingly, however, we find that despite the prospect of spillovers, a joint venture is sometimes not in the interest of a host country.