Title: The seductive power of Irish rain. Location determinants of foreign R&D investments in European regions
Publisher: Publications Office of the European Union
Publication Year: 2017
JRC N°: JRC106423
ISBN: 978-92-79-68834-8
ISSN: 1831-9424
Other Identifiers: EUR 28605 EN
OP KJ-NA-28605-EN-N
URI: http://publications.jrc.ec.europa.eu/repository/handle/JRC106423
DOI: 10.2760/31641
Type: EUR - Scientific and Technical Research Reports
Abstract: Foreign direct investments (FDI) in research and development (R&D) are important catalysts of economic development. Through a diversity of direct and indirect policy measures, governments compete in attracting such investments. Our study investigates the factors that affect the degree of attractiveness of European regions from the perspective of a company investing abroad based on evidence gathered from all the FDI in R&D realized between 2003 and 2014. We use mixed logit models to assess: i) the relative importance of the factors influencing the choice made by multinational firms about where to locate foreign R&D investments to European regions, and ii) how such influences vary according to timing, investments’ area of provenience and industry. On average, the fiscal regime and the size of destination regions as well as the sharing of a common language in the sending and receiving regions are the most important determinants. Labor costs, technological strength and R&D expenditure, especially performed by the higher education sector, are also important, yet to a lower extent. The strength of determinants still varies greatly across considered breakdowns.
JRC Directorate:Joint Research Centre Corporate Activities

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