Technology Spillover Effect Of Multinational Corporations’ R&D Investment In China

Under the background of R&D globalization, multinational corporations’ R&D investment activities have nearly infiltrated into every walk of life in China. Tremendous changes have taken place in the investment strategies of multinational corporations. At the initial stage, the investment activity was led by government’ policy of "market for technology", but now they are racing to invest in China. Those changes have caused the in-depth thinking of multinational corporations’ R&D investment activities. What’s the relationship between the R&D investment activities and the technology innovation output of local enterprises? What is the technology spillover effect of the multinational corporations’ R&D investment activities? As the communication equipment, computers and other electronic equipment manufacturing industry taking the highest share of multinational corporations’ R&D investment, we choose it as the typical industry to do a deep study on the above issues.Firstly, based on the previous studies, we elaborate the technology spillover effect from three paths:demonstration-imitation effects, human resource effects and competition effects. And the dynamic system method is used to build the innovation system consisting of multinational corporations and the local corporations. The function mechanism of technology spillover is analyzed in detail.On the basis of theoretical analysis, cointegration test and Granger causality analysis are introduced to dig into the relationship between R&D input and innovation output of multinational corporations and local enterprises as the lead analysis. Results show that there is indeed a causal relationship between the R&D investment activities of multinational corporation and technology innovation capability of local enterprises. Then the panel data model is used to analyze the influence of multinational corporations’ R&D investment on local corporations’ technology innovation output. Results show both positive spillover effects and negative spillover effects exist. To be specific, these are remarkable human resources competition effect; multinational corporations’ R&D investment has inhibiting effect on local corporations’ innovation output; there exist mutual promoted effects on innovation output between the multinational corporations and the local corporations.Finally, we put forward corresponding research conclusions and management implications, as well as the limitations of our study and follow-up research directions.