Study On Location Choice Of MNCs' R&D Investment In China

The status of science and technology in the comprehensive national strength competition is prominent. Science and technology is the main power which pushes the economic development and civilization progress, while R&D is the most innovative part and play a key role in it. In the late 70s of 20th century, with the development of science and technology and the deepening of economic globalization, MNCs began the process of R&D investment abroad. R&D investment flowed only between the developed countries at first, and then entered the developing countries from developed countries, and finally in turn. Now the globalization of MNCs R&D investment is becoming a new trend of international investment around the word. Relying on advantages of large-scaled market, affluent resources of technology and human and good prospect, China plays a more and more important position in MNCs'management strategies, and becomes the developing country that attracts the most MNCs to set their R&D centers here. China turns into the base of R&D and innovation activities from a emerging R&D market. The systemic study on the phenomenon of MNCs'R&D investment in China and the affective factors of location choice, has a good theory and practical significance on rational use of MNCs'R&D investment, guiding the layout of R&D activities and enhancing the independent innovation ability.This paper focuses on the study of location choice of MNSs'R&D investment in China. Firstly, this paper reviews the relating literatures from the perspectives of both abroad and domestic. Secondly, through the study on the status quo of MNSs'R&D investment in China, it tries to sort out the key affective factors of location choice, and then build a two-level location factors system. The factors are market factors including market scale and degree of market openness, technology resources including research personnel, local R&D investment and scientific and technological achievements, infrastructure including information condition, financial services and intellectual property protection, government's attitude including supporting policies and administrative efficiency. Thirdly, this paper tests these factors using quantitative analysis and case study of Shanghai, which strengthening the explanation of the problem. Finally, this paper gives a conclusion of all the studies. All the factors have important influence on location choice of MNSs' R&D investment. Based on the conclusion, the paper gives some suggestions and countermeasures to both government and China's local corporations.