R&D Activities of Manufacturing Multinationals in China:Structure,Motivations and Regional Differences

This paper investigates the R&D motivations of various multinationals operating in China,drawing on a large-scale, firm-level dataset of official Chinese statistics on science andtechnology activities.The present study shows that R&D efforts in China have intensified forboth foreign-owned and domestic firms, but less so for foreign-owned firms, perhaps becauseforeign-owned firms tend to operate on a foundation of technological capabilities developedwithin their home countries.Statistical analysis confirms that the major motivations for foreign R&D in China areproduction-driven, not market-driven or technology-driven.Nevertheless, one seessignificant variations in foreign R&D strategies from region to region.Guangdong ischaracterized by production-driven R&D.In Beijing, R&D strategies tend to take atechnology-driven approach, drawing on the clusters of scientific institutions.In Shanghai,the R&D efforts of multinationals lend to focus on support for market-driven R&D.