Journal Article

No. 2015-34 | October 29, 2015
Choice of Foreign R&D Entry Mode and Its Relation to Firm Performance: A Firm-level Analysis for Switzerland and Austria PDF Icon

Abstract

The objective of this study is to identify the determinants of a firm’s foreign entry mode choice and the relationship between mode selection and firm performance for the specific case of R&D—a topic not yet investigated in entry mode research. Separate estimates of a Heckman selection model for Austria and Switzerland based on comparable firm-level data and variable specification show for both countries that the OLI model is well-suited to explain not only the propensity to invest in R&D abroad but also the related choice between an equity-based and a non-equity governance mode. Moreover, the research reveals that foreign R&D activity is positively related to firm performance and that this relationship is stronger in the case of an equity-based mode of governance, however only in the Swiss case. The differences between the two countries primarily reflect the much higher degree of internationalisation of the Swiss economy.

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http://www.economics-ejournal.org/economics/journalarticles/2015-34/data-availability-2015-34/view

JEL Classification

F23 F61 L24 O32

Citation

Heinz Hollenstein and Martin Berger (2015). Choice of Foreign R&D Entry Mode and Its Relation to Firm Performance: A Firm-level Analysis for Switzerland and Austria. Economics: The Open-Access, Open-Assessment E-Journal, 9 (2015-34): 1—46. http://dx.doi.org/10.5018/economics-ejournal.ja.2015-34

Assessment

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