Factors determining offshore location choice for R&D projects: a comparative study of TRIAD regions

Mehmet Demirbag, Keith Glaister

    Research output: Contribution to journalArticle

    126 Citations (Scopus)

    Abstract

    This paper examines empirically the determinants of offshore location choice between country clusters. Based on a dataset of 1722 R&D projects by MNEs located in developed and emerging countries, we examine the impact of home and host country, industry, and firm level variables on choice of location. We draw on the extended OLI paradigm to develop our hypotheses. Using the EU15 as a base group, a multinomial logit model is estimated between the regions of USA&Canada, Eastern Europe&Russia, emerging countries of Asia, and India&China. At the regional level, findings show that the R&D wage difference and knowledge infrastructure difference between home and host countries, the science and engineering talent pool size, and political risk level of host countries are important determining factors. At the firm level, experience of overseas R&D projects and prior experience of research in the host country are found to be important location determinants. A distinguishing feature of the paper is that we examine regions in relation to a base region, and then further examine the impact of a marginal change in independent variables on the likelihood of the choice of a region for new offshore R&D projects.
    Original languageEnglish
    Pages (from-to)1534-1560
    Number of pages27
    JournalJournal of Management Studies
    Volume47
    Issue number8
    DOIs
    Publication statusPublished - Dec 2010

    Keywords

    • determining factors
    • offshore location
    • choice
    • r&d projects
    • comparative study
    • developed regions
    • emerging regions

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