The importance of clusters for spillovers from foreign direct investment and technology sourcing

De Propris, Lisa and Driffield, Nigel (2006). The importance of clusters for spillovers from foreign direct investment and technology sourcing. Cambridge Journal of Economics, 30 (2), pp. 277-291.

Abstract

This paper examines the link between cluster development and inward foreign direct investment. The conventional policy approach has been to assume that inward foreign direct investment (FDI) can stimulate significant clustering activity, thus generating significant spillovers. This paper, however, questions this and shows that, while clusters can generate significant productivity spillovers from FDI, this only occurs in pre-existing clusters. Further, the paper demonstrates that foreign-owned firms that enter clusters also appropriate spillovers when domestic firms undertake investment, raising the possibility that clusters are important locations for so called technology, or knowledge sourcing activities by MNEs. © 2006 Oxford University Press.

Publication DOI: https://doi.org/10.1093/cje/bei059
Divisions: Aston Business School > Economics finance & entrepreneurship
Aston Business School > Economics finance & entrepreneurship research group
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Additional Information: © The Author 2005. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.
Uncontrolled Keywords: Cluster,Foreign direct investment,Productivity spillovers,Economics and Econometrics
Published Date: 2006-03-01

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