THE ADVANTAGE OF FOREIGNNESS IN INNOVATION

摘要

This study analyzes differences in the innova-tiveness of subsidiaries of foreign multinational enterprises (MNEs) in comparison to domestic companies competing in the same country. There appear to be two conflicting views. On the one hand, some research has argued that subsidiaries of foreign MNEs (henceforth, 'subsidiaries') areat a disadvantage in comparison to domestic firms because they suffer from a cost of doing business abroad (Hymer, 1976) or a liability of foreignness (Zaheer, 1995). On the other hand, other studies assume that subsidiaries have a technological advantage over domestic firms because the former receive knowledge and technology from the MNE (e.g., Buckley and Casson, 1976; Vernon, 1966). Unfortunately, no studies have compared their innovativeness and, thus, we still debate about whether they differ and why, and we are unable to provide managers with proper guidance.I clarify the debate by linking technology strategy (e.g., Helfat, 1997; see a review in Fager-berg, Mowery, and Nelson, 2005) and neoinstitu-tional theory's application to the study of the MNE