Open Access BASE2010
Subsidizing Away Exports? A Note on R&D-policy towards Multinational Firms
Abstract
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.
Themen
Sprachen
Englisch
Verlag
Stockholm: Research Institute of Industrial Economics (IFN)
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