Technology Transfer and Spillovers in International Joint Ventures
37 Pages Posted: 11 Dec 2003
Date Written: October 2003
Abstract
This paper analyzes the effects of a potential spillover on technology transfer of a multinational enterprise and on the host country policy. In particular, we examine how both parties' incentives can be controlled through the ownership structure in an international joint venture. In contrast to existing arguments, we show that spillovers must not always have negative effects on technology transfer and they may be efficiency-improving. Moreover, there are circumstances where a joint venture is mutually beneficial. Surprisingly, however, we find that despite the prospect of spillovers, a joint venture is sometimes not in the interest of a host country.
Keywords: Foreign direct investment, joint ventures, ownership structure, multinational enterprise, spillovers, transition economies
JEL Classification: D43, F21, F23, L13, O12, P31
Suggested Citation: Suggested Citation
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