Emerging Asian Economies and MNCs Strategies

Emerging Asian Economies and MNCs Strategies

New Horizons in International Business series

Edited by Robert Taylor and Bernadette Andreosso-O’Callaghan

Analysing the role of multinational investors in emerging Asian economies and the implications for regional economic integration, this astute study examines the increasing role being played by Asian countries in the global economy. Encompassing a large number of diverse manufacturing and service sectors, this book highlights the cultural and strategic challenges faced by multinational investors in the region in which they invest. It shows that despite high rates of economic growth in Asian countries presenting multinational traders and investors with unparalleled market opportunities, there have been only tentative moves towards regional economic integration. Areas such as trade facilitation, uniform customs clearance, removal of non-tariff barriers and labour deployment issues are yet to be adequately addressed.

Chapter 6: MNCs’ offshore R & D co- location strategies: comparison of Western and Asian firms in China

Pei Yu and Jean- Louis Mucchielli

Subjects: asian studies, asian business, business and management, asia business, international business


This chapter focuses on MNCs’ R & D co-location strategies in China, and enriches recent studies by both theoretical and empirical aspects. Firstly, it constructs a conceptual framework on R & D co-location strategies, by combining location theory with R & D networking literature. Secondly, instead of a national level which causes aggregation bias, it focuses on a city level. It verifies the framework used by 185 US, 107 European and 115 Asian R & D affiliates’ location strategies across 27 Chinese cities, during the period 1992–2011. Thirdly, it adopts discrete choice models, which consider host geographic heterogeneity, to examine theoretical hypotheses. The results confirm MNCs’ cross-country differences in co-location strategies: US firms attach importance to external linkages, such as public knowledge resources and foreign R & D affiliates; however, European firms prefer internal linkages, such as intra-firm forward linkage, home country agglomeration and intra-industry spillovers. Asian firms adopt traditional cost- and market-seeking strategies. In addition, China’s geographic structure also impacts in a variety of ways on the sample firms. Key words: offshore R & D affiliates, co-location strategies, cross-country differences, China.

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