Analysis The Effects On Chinese Technologies Through The Localization Of MNCs' R&D

Confronted with the rapid development of world economy and the globalization of science and technology, multinational corporations(MNCs) are establishing R&D research institutions, and implementing the research and development of new technologies and new products in order to gain high profit margins and to enhance their competitiveness in the global environment based on the comparative advantages of talents, science and technology, and infrastructure in the host country instead of focusing on the traditional layout of home-country based R&D centers. As China has kept sustainable development of economy, more and more MNCs are localizing their R&D in China by making good use of Chinese comparative advantages in the market and of technological talents(There are about 1200 R&D institutions since 1994)., This is the significant adjustment in the strategy of multinational investment in China. This new tendency, based on the localization of production, management, and procurement, will bring about profound impact on the innovation system of national technology. Therefore, the study of MNCs' strategies to localize their R&D in China, their impacts and influence in China, and the counter-measures by Chinese government and enterprises has great significance in both theory and practice.The dissertation, based on its internal logic, includes the following framework and contents. Chapter one is an introduction, which illustrates the background, the significance of the topic, literature reviews, research approaches and the structure of the text. Chapter two reviews the theory of the location of MNCs' R&D. Chapter Three illustrates the status and cause of the localization of MNCs' R&D in China. Chapter four performs theoretical analyses on the influence of MNCs' R&D localization over technical progress in China, and analyzes positive and negative effects on Chinese technologies through the localization of MNCs' R&D, The writer thinks that the influence over technological progress based on domestic R&D expenditure is not as significant as that by FDI in China with certain hysteresisThe contribution of this dissertation lies in the fact that the paper finds out the correlation between the efficiency of technical progress in China and the inputs of R&D by MNCs, and of domestic R&D and its staff members. The deficiencies of the paper are that the paper does not cover the technical spillover effect on Chinese economy by the localization of MNCs' R&D. It only focuses on the influence of Chinese technological progress by the localization of MNCs' R&D and the counter- measures of Chinese governments and enterprises.