Template-type: ReDIF-Paper 1.0
Author-Name: Gaetan de Rassenfosse
Author-Workplace-Name: Ecole polytechnique federale de Lausanne
Author-Email: gaetan.derassenfosse@epfl.ch
Author-Homepage: http://www.gder.info
Author-Name: Russell Thomson
Author-Workplace-Name: Swinburne University of Technology
Author-Email: russellthomson@swin.edu.au
Title: R&D offshoring and home industry productivity
Abstract: Offshoring R&D commonly invokes concerns regarding the loss of high value jobs and a hollowing out of technological capabilities, but it can also benefit domestic firms by enabling them to tap into the global technological frontier. We study the effect of R&D offshoring on industrial productivity in the home country using industry-level data for 18 OECD countries over a 26-year period. Simultaneity between productivity and R&D offshoring is addressed by using foreign tax policy as an instrument for offshored R&D. We show that R&D offshoring contributes positively to productivity in the home country, irrespective of the host country destination.
Classification-JEL: F23, F62, O25, O33, O47, L6
Keywords: R&D offshoring, globalization, productivity, foreign R&D
Length: 41 pages
Creation-Date: 2018-12
File-URL:  https://cdm-repec.epfl.ch/iip-wpaper/WP5.pdf
File-Format: application/pdf
Handle:  RePEc:iip:wpaper:5