Innovation and Technology Transfer within Multinational Firms

Abstract

Abstract This chapter analyses the issue of international innovation and technology transfer within multinational firms. It considers how the organizational and locational context of this affects both firm and national performance. Within the whole issue of international technology flows, intrafirm cross-border technology flows has remained a neglected issue for analysis and discussion. This is despite being long recognized as a major element in international technology transfer. Even in the late 1970s technological balance of payments analysis revealed that intrafirm payments accounted for between two-thirds and three-quarters of total payments in the USA, UK, and Germany and that this figure had increased in all three countries over the late 1960s and 1970s (Madeuf, 1984: 135). Despite these general estimates, however, the scale and process of such transfers has been difficult to measure and quantify and therefore has been resistant to analysis. In part this is bound up with the sensitive nature of such transactions, since it is a key element in transfer pricing and profit flows between subsidiary operations (Chudnovsky, 1981). However, even in relation to a management perspective, the process of intrafirm technology flows has remained relatively neglected.