Historically, the main motive of the internationalization
of the firm was the search for new markets and natural resources
abroad. Thus, multinational corporations (MNCs) established competence-exploiting
subsidiaries abroad that drew heavily upon the prior competence
and knowledge base of their parent company to serve local markets
or extract natural resources. More recently, the internationalization
of the firm has been increasingly motivated as well by the drive
to form integrated international networks for knowledge creation.
Within MNCs, some subsidiaries have evolved to take on a competence-creating
A key feature that has supported internationally dispersed innovation
in the MNC is the localized external networks that are utilised
by competence-creating subsidiaries to tap into agglomerations
of specialized expertise in their own immediate regional vicinity.
These include linkages with the science base, government-funded
organisations and other institutions as well as with local companies.
Hence, competence-creating subsidiaries tend to be sited in centres
The increasing scope for technological interchanges between complementary
lines of knowledge creation has led also to a growing number of
technology-based international strategic alliances between MNCs.
Some of the key issues to be addressed in this track are:
- The characteristics of localized knowledge spillovers between
foreign-owned companies and other actors in sub-national regions.
- The geography of knowledge sourcing in the innovation of
- Local capability formation and knowledge creation amongst
indigenous firms with links to foreign-owned subsidiaries (eg.
as suppliers or as joint venture partners), or in firms with
other international business linkages through sub-contracting
or licensing arrangements with MNCs.
- The role of the fragmentation of production (the value chain)
in the international dispersion of knowledge-creating functions,
and thus in catch-up processes in developing countries and regions.