In:
Multinational Business Review, Emerald, Vol. 20, No. 1 ( 2012-03-09), p. 6-25
Abstract:
This paper examines the role of location‐specific (L) advantages in the spatial distribution of multinational enterprise (MNE) R & D activity. The meaning of L advantages is revisited. In addition to L advantages that are industry‐specific, the paper emphasises that there is an important category of L advantages, referred to as collocation advantages. Design/methodology/approach Using the OLI framework, this paper highlights that the innovation activities of MNEs are about interaction of these variables, and the essential process of internalising L advantages to enhance and create firm‐specific advantages. Findings Collocation advantages derive from spatial proximity to specific unaffiliated firms, which may be suppliers, competitors, or customers. It is also argued that L advantages are not always public goods, because they may not be available to all firms at a similar or marginal cost. These costs are associated with access and internalisation of L advantages, and – especially in the case of R & D – are attendant with the complexities of embeddedness. Originality/value The centralisation/decentralisation, spatial separation/collocation debates in R & D location have been mistakenly viewed as a paradox facing firms, instead of as a trade‐off that firms must make.
Type of Medium:
Online Resource
ISSN:
1525-383X
DOI:
10.1108/15253831211217161
Language:
English
Publisher:
Emerald
Publication Date:
2012
detail.hit.zdb_id:
2070887-7
SSG:
3,2
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