NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Do Multinationals' R&D Activities Stimulate Indigenous Entrepreneurship? Evidence from China's "Silicon Valley"

Hongbin Cai, Yasuyuki Todo, Li-An Zhou

NBER Working Paper No. 13618
Issued in November 2007
NBER Program(s):   IO   ITI

Using a unique firm-level dataset from China's "Silicon Valley," we investigate how multinational enterprises (MNEs) affect local entrepreneurship and R&D activities upon entry. We find that R&D activities of MNEs in an industry stimulate entry of domestic firms into the same industry and enhance R&D activities of newly entering domestic firms. By contrast, MNEs' production activities or domestic firms' R&D activities do not have such effect. Since MNEs are technologically more advanced than domestic firms, our findings suggest that diffusion of MNEs' advanced knowledge to potential indigenous entrepreneurs through MNEs' R&D stimulates entry of domestic firms.

download in pdf format
   (316 K)

email paper

This paper is available as PDF (316 K) or via email.

Acknowledgments

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w13618

Published: Social Interactions and Entrepreneurial Activity, Mariassunta Giannetti, Andrei Simonov. in Entrepreneurship: Strategy and Structure, Hellmann and Stern. 2009

Users who downloaded this paper also downloaded these:
Cai, Chen, Fang, and Zhou w15396 Microinsurance, Trust and Economic Development: Evidence from a Randomized Natural Field Experiment
Cai, Jin, Liu, and Zhou w18961 More Trusting, Less Trust? An Investigation of Early E-Commerce in China
Giannetti and Simonov Social Interactions and Entrepreneurial Activity
Cai, Henderson, and Zhang w15067 China's Land Market Auctions: Evidence of Corruption
Du, Harrison, and Jefferson w16767 FDI Spillovers and Industrial Policy: The Role of Tariffs and Tax Holidays
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us