Innovation and the International Firm Structure: Theory and Evidence from German Firm-Level Data

Hansen, Thorsten (April 2010): Innovation and the International Firm Structure: Theory and Evidence from German Firm-Level Data. SFB/TR 15 Discussion Paper No. 315

Abstract

This paper studies the impact of innovation on the organizational structure. The theoretical framework predicts that a larger parental pool of knowledge raises the probability of offshoring. This holds in a national as well as an international context. However, when the producer loses territorial protection, the changeover from non-integration to integration is delayed. Employing data on German firms investing in Eastern Europe finds empirical evidence for the theoretical predictions. The results are robust to different measurements and an instrumental variable regression.

• Item Type: Paper
• Faculties: Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems; Special Research Fields > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems > B7 - Globalisierung und der Anstieg der Vorstandsbezüge; Economics; Economics > Chairs > Chair of International Economics
• Subjects: 300 Social sciences > 330 Economics
• JEL Classification: D23, D51, F23, L14, L21, L22, L23
• Language: English