Subsidizing away exports? : a note on R&D-policy towards multinational firms

Pehr-Johan Norbäck

In this paper, I investigate whether instead of strengthening home-based production, government R&D-subsidies can induce R&D-intensive firms to locate production abroad. Investigating firm-level data on Swedish MNEs, however, I find no evidence of such relocation. R&D subsidies rather tend to en courage export production at the expense of foreign production. The theory presented suggests that this is consistent with technology transfer costs, which outweigh trade costs for physical goods. -- Multinational firms ; R&D ; subsidies ; location ; empirical analyses

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Year of publication:	2010
Authors:	Norbäck, Pehr-Johan
Publisher:	Stockholm : Research Institute of Industrial Economics
Subject:	Multinationales Unternehmen \| Transnational corporation \| Industrieforschung \| Industrial research \| Forschungsfinanzierung \| Research funding \| Internationale Produktion \| International production \| Schweden \| Sweden