International Allocation of R&D Activity by U.S. Multinationals: The East Asian Experience in Comparative Perspective

This paper examines patterns and determinants of overseas R&D expenditure of MNEs, with emphasis on the East Asian experience, using a new panel dataset relating to U.S.-based manufacturing MNEs over the period 1990-2001. It is found that inter-country differences in R&D intensity of operation of US MNE affiliates are fundamentally determined by the domestic market size, overall R&D capability and cost of hiring R&D personnel.