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CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology KTH/CESIS Working Paper Series in Economics and Institutions of Innovation

No 439:
Offshoring R&D

Joonas Tuhkuri (), Hans Lööf (), Ali Mohammadi () and Petri Rouvinen ()

Abstract: This paper explores offshoring of firms’ research and development functions. Our analysis employs a previously untapped and unique Eurostat International Sourcing Survey. The results are easy to summarize. First, the magnitude of R&D offshoring is small. Second, a large majority of R&D is offshored within the en-terprise group, in contrast to offshoring outside of the enterprise group. Third, most of R&D offshoring from Europe is directed to high-income European countries, not so to low-cost countries in Europe, China, or India. Fourth, R&D jobs do have been lost from offshoring; however, the negative employment impact has been moderate. But the Eurostat International Sourcing Survey does not allow entangling the full net employment effect of R&D offshoring, which could be either negative or positive.

Keywords: R&D; offshoring; outsourcing; innovation; product development; (follow links to similar papers)

JEL-Codes: F00; F16; F23; J44; L22; O32; O33; (follow links to similar papers)

13 pages, May 12, 2016

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