Foreign subsidiaries and technology sourcing in Spain

Firms acquire external technological knowledge via different channels. In this paper we compare the technology sourcing via R&D outsourcing, R&D outsource offshoring, domestic cooperation for innovation and international cooperation for innovation of foreign subsidiaries and domestic firms. Because the different technology sourcing choices are potentially correlated we apply a multivariate probit specification which allows for systematic correlations among the different choices. The results show that the different technology sourcing choices are indeed interdependent and that foreign subsidiaries show a different pattern of external technology sourcing. Compared to affiliated domestic companies, foreign subsidiaries show a smaller propensity for external technology sourcing via R&D outsourcing from independent firms in the host country, for R&D outsource offshoring, and for international cooperation for innovation. In contrast, foreign subsidiaries show a greater propensity for domestic cooperation for innovation.