On The Technology Effect Of Multinationals' R&D Investment

R & D internationalization has become an important strategy for multinational companies to achieve high profits and to improve their competitiveness in the time of today's globalization of the world economy. Since the mid-1990s, in order to build the technical competitive advantages in Chinese market, more and more multinational companies have taken the comparative advantages of our Chinese market space and technology professionals, and gradually bring China into their global R & D networks, most of the their R & D institutes located in China .Particularly we concern about the massive influx of multinational companies in China in recent years, and the focus of their investment has gradually shifted from the Pearl River Delta region to the Yangtze River Delta Area, also the intensity of multinational R & D investment to Yangtze River Delta region has increased. This paper analyzes the overall profile of the R & D localization of multinational companies in the Yangtze River Delta region, focused on the technological effect of multinational companies in the Yangtze River Delta region to our technological progress and innovation, particularly on the influence to the research and development capabilities and technological advancement to our domestic enterprises.The article is composed of five chapters, the major elements are following:The first chapter talks about the background and significance of topics, as well as the main ideas and methods, and in the summary of the literature related, it highlights the motive of multinational companies'overseas research and development of the host country and the impact of technological progress to the state enterprises and research. In Chapter II, it gives a general theoretical analysis of the technical effect from two aspects, the technology spillover and the crowding - out effect on R & D investment of multinational companies in the host country, and then this paper takes a simple and comprehensive analysis of the two effects. In Chapter III, this paper analyzes the overall trend and the characteristics of multinational companies'R & D investment to the Yangtze River Delta Area. In Chapter IV this paper uses empirical analysis and case study of typical cities to measurement the effect of multinational companies'R & D investment localization in the Yangtze River Delta Area, and then points out the constraints of the technological overflow effect of multinational companies R & D investment to the Yangtze River Delta Area. At last, Chapter V gives advices from the level of the enterprise and the government separately on the basis of analysis before. The multinational companies'R& D investment have dual nature, the technological spillover effect and the crowding - out effect of their R & D investment in the host country is intrinsically mutual restraints. Take the Yangtze River Delta Area for example, on the one hand, the local subsidiaries of multinational companies accesses advanced technological advantages from the localization of multinational companies investment to the Yangtze River Delta Area, expand the technology gap with local enterprises, so that they squeeze out the market share of local enterprises. On the other hand, local enterprises are also likely benefit from the spillover effects of the development of localization of multinational companies. So the net effect depends on the comparison of two effects.