10 The role of multinational corporations in innovation systems of developing countries: from technology diffusion to international involvement

MARIN, ANABEL, ARZA, VALERIA

Handbook of Innovation Systems and Developing Countries – Building Domestic Capabilities in a Global Setting

Edward Elgar

Lugar: Cheltenham; Año: 2009; p. 280 - 310

National innovation systems (NIS) in developing countries are typicallyineffi cient and/or ineff ective in their task of producing and exploitingknowledge (Intarakumnerd et al, 2002; Alcorta and Perez, 1998; Arocenaand Sutz, 2000; Radosevic, 1999; Viotti, 2002).1 Development and innovationstudies have therefore acknowledged the importance for developingcountries to remain open and receptive to knowledge and technologiescreated abroad (see for instance Lundvall, 1992; Wong, 2001; Hobday,1997; Keller, 2004). The literature has been less willing, however, to highlightthe importance of promoting mechanisms to improve and sustain theinternational involvement of the system. The international involvement ofthe system relates to the capacity of the system of having in place mechanismsto assure not only access to a given piece of technology or knowledgebut also involvement in international processes of knowledge creation anddiff usion.Mechanisms of international involvement are becoming increasinglyimportant for developing countries given two undeniable facts of technologicalchange. First, technologies are ever becoming more complex,which implies that technological change tends increasingly to involve sectoraland inter-fi rm interdependences. Industrializing countries, therefore,which typically produce with sectoral structures that are seldom diversifi edincreasingly need to have mechanisms that allow them to get involved ininternational processes of knowledge creation in order to gain access to thecomplementary assets that are needed to increase the likelihood of becomingthemselves worldwide knowledge producers. Secondly, the worldwiderate of technological change is becoming faster and faster. Therefore,developing countries, which often produce using technologies far behindthe technological frontier, increasingly need to be internationally involvedto keep the path of worldwide technological change.There are various potential mechanisms to facilitate internationalinvolvement of NISs. These include the movement of qualifi ed workersand/or researchers, the promotion of knowledge interactions with expatriates(diaspora), the promotion of international technological joint venturesor joint research projects, scholarships for graduate students to studyabroad, international programmes of inter-governmental cooperation,and so on.Among those various possible mechanisms in this chapter we focus onthe potential role of multinational corporation (MNC) subsidiaries. Wesee the installation of MNC subsidiaries in a particular country as ‘off ering’a potential mechanism or dynamic of international involvement thatwould enable the host countries not only to have more direct or smootheraccess to existing technological (and managerial) competences originatedoutside the national systems, but also to be part of international processesof knowledge creation and diff usion. Our view is that MNC subsidiaries arein a privileged situation to do so, given their position at the interface oftwo systems of knowledge: the global – via their links with their MNCsand other international agents – and the national. We recognize, however,that they do not always do so. In this chapter we then explore the diff erentdimensions that must be considered when analysing this potential bridgingrole of MNC subsidiaries, and what we know and do not know about thisrole.