Entrepreneurs, Multinational Enterprises and Policy
Edited by Maureen McKelvey and Sharmistha Bagchi-Sen
Chapter 13: Foreign direct investment in R & D and the base of the pyramid: is a new space of innovation emerging in India?
This chapter addresses the role of new customers in developing innovation spaces, focusing upon base-of-the-pyramid (BOP) customers in India and the response of domestic and foreign enterprises and institutions to this group. Foreign direct investment (FDI) in research and development (R & D) from US and European companies in emerging economies are drawing an increasing amount of attention in the literature. Historically, multinational corporation’s (MNC) R & D operations with a focus on innovation were located in their home country. However, in recent years, open innovation has pushed MNCs to have global innovation networks. China and India with their large markets and success stories of their homegrown emerging multinationals in certain industries, especially information technology (IT) and pharmaceuticals, have become major destinations of FDI in R & D.
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