Determinants of internal and external R&D offshoring: Evidence from Spanish firms

This paper analyzes the determinants of R&D offshoring of Spanish firms using information from the Panel of Technological Innovation. We find that being an exporter, international technological cooperation, continuous R&D engagement, applying for patents, being a for-eign subsidiary, and firm size are factors that positively affect the decision to offshore R&D. In addition, we find that a lack of financing is an obstacle relatively more important for inde-pendent firms than for firms that belong to business groups. For these latter, we also obtain that the factors that influence the decision to offshore R&D differ depending on whether the firm purchases the R&D services within the group or through the market: a higher degree of importance assigned to internal sources of information for innovation as compared to mar-ket sources increases (decreases) the probability of R&D offshoring only through the group (market).

Determinants of International R&D Outsourcing: The Role of Trade

This paper investigates the determinants of international R&D outsourcing, in particular the role of trade. We construct a monopolistic competition model with heterogeneous firms where outsourcing increases a firm’s fixed transaction as well as its productivity. Financial constraints affect the decision to outsource R&D more to non-exporters than to exporters. In contrast, exporters are more sensitive to a lack of information because they have higher losses when there is technology leakage. We test these predictions using a panel database of Spanish companies. The results highlight the relevance of information in competitive markets, and the role of trade to induce companies to engage in other globalization strategies.