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

ANABEL MARIN; VALERIA ARZA

Handbook of Innovaiton Systems and Developing Countries, Building domestic capabilities in a global setting

Edward Elgar

Lugar: Massachusetts; Año: 2010; p. 280 - 310

National innovation systems (NIS) in developing countries are typically inefficient and/or ineffective in their task of producing and exploiting knowledge (Intarakumnerd et al, 2002; Alcorta and Perez, 1998; Arocena and Sutz, 2000; Radosevic, 1999; Viotti, 2002).1 Development and innovation studies have therefore acknowledged the importance for developing countries to remain open and receptive to knowledge and technologies created abroad (see for instance Lundvall, 1992; Wong, 2001; Hobday, 1997; Keller, 2004). The literature has been less willing, however, to highlight the importance of promoting mechanisms to improve and sustain the international involvement of the system. The international involvement of the system relates to the capacity of the system of having in place mechanisms to assure not only access to a given piece of technology or knowledge but also involvement in international processes of knowledge creation and diffusion. Mechanisms of international involvement are becoming increasingly important for developing countries given two undeniable facts of technological change. First, technologies are ever becoming more complex, which implies that technological change tends increasingly to involve sectoral and inter-firm interdependences. Industrializing countries, therefore, which typically produce with sectoral structures that are seldom diversified increasingly need to have mechanisms that allow them to get involved in international processes of knowledge creation in order to gain access to the complementary assets that are needed to increase the likelihood of becoming themselves worldwide knowledge producers. Secondly, the worldwide rate of technological change is becoming faster and faster. Therefore, developing countries, which often produce using technologies far behind the technological frontier, increasingly need to be internationally involved to keep the path of worldwide technological change. There are various potential mechanisms to facilitate international involvement of NISs. These include the movement of qualified workers and/or researchers, the promotion of knowledge interactions with expatriates (diaspora), the promotion of international technological joint ventures or joint research projects, scholarships for graduate students to study abroad, international programmes of inter-governmental cooperation, and so on. Among those various possible mechanisms in this chapter we focus on the potential role of multinational corporation (MNC) subsidiaries. We see the installation of MNC subsidiaries in a particular country as ?offering? a potential mechanism or dynamic of international involvement that would enable the host countries not only to have more direct or smoother access to existing technological (and managerial) competences originated outside the national systems, but also to be part of international processes of knowledge creation and diffusion. Our view is that MNC subsidiaries are in a privileged situation to do so, given their position at the interface of two systems of knowledge: the global ? via their links with their MNCs and other international agents ? and the national. We recognize, however, that they do not always do so. In this chapter we then explore the different dimensions that must be considered when analysing this potential bridging role of MNC subsidiaries, and what we know and do not know about this role.