Knowledge that Transforms

This paper develops a people-centric perspective on the geographical dispersion of technological renewal in the multinational corporation (MNC). We contend that a large proportion of all foreign technological advancements can be attributed to a handful of individual inventors, suggesting a blockbuster effect of subsidiary technological development. This suggests that analyses carried out at the subsidiary or firm level disguise significant yet largely unexplored variation in the technological contributions made by individual members of these foreign units. To support this proposition, the paper draws upon an original data set that comprises all of the advanced foreign subsidiaries of 21 Swedish MNCs between 1893 and 2008, and follows their patenting activity in order to document the distribution of inventive activity, both across and within individual subsidiaries. The findings at the subsidiary level show that the distribution of technological activity and contribution to the overall multinational group is significantly skewed; the paper then empirically explores the assumption that a similar distribution also applies at the level of individual inventors. The results point to a pattern whereby most inventors make only occasional and limited technological contributions and, instead, more significant numbers of new technological discoveries are attributable to a select group of exceptionally inventive individuals. In the light of the results, we suggest the fruitfulness of applying a people-centric perspective on the sources of sustained competitive advantage of the MNC, the management of geographically dispersed capabilities in the multinational network, and the geographical sources of technological renewal in the MNC.

The paper adds to the existing literature on the determinants of government spending in Research and Development (R&D) by considering the role of strategic interactions among countries as one of the possible competing explanations, within a spatial econometric framework. We account for several factors affecting national levels of public R&D spending, including (i) the international context – i.e. Lisbon strategy; (ii) country characteristics – level of private R&D, GDP, trade openness and the National System of Innovation; (iii) countries’ similarities in relation to (a) trade and economic size and (b) sectoral specialization. The analysis is carried out on 14 European countries. First, we find that factors traditionally affecting the level of public R&D expenditure, such as the scale of the national economy, trade openness, sectoral specialization and private R&D, significantly influence the level of public R&D in European countries between 1994 and 2006. Interestingly, the introduction of the Lisbon strategy does not seem to have affected changes in the levels of public R&D spending. Second, by using different weight matrices, we confirm the existence of strategic interactions in relation to R&D spending among European countries with similar economic, international trade and sectoral structure characteristics, though not geographically close.

The paper addresses two issues. One concerns the general conditions and procedures involved in the emergence of a tool industry. Tool industries emerge and evolve as a collection of capital goods and tool inventors and manufacturers. One of our goals is to use some of the works on historical cases to build a heuristic framework concerning the main conditions for the emergence and development of tool industries. The other issue is more factual and involves the question whether a tool industry is today emerging in the area of education. The paper describes the emergence of a population of firms specialised in developing and commercialising educational tools and instructional technologies and discuss whether this trend can be seen as part of the solution to the innovation deficit and cost disease problems in this sector?