Interactive learning processes and mergers and acquisitions in national systems of innovation

Abstract

Prior evidence confirms the existence of a close relationship between home-country characteristics and knowledge-related arguments in the explanation of M&A outflows. This contribution bridges the gap between national systems of innovation (NSIs) and emerging multinationals (EMNE) literature for operationalising a bilateral learning process resulting from the link between a process of internationalisation (as followed by firms from emerging economies) and the generation of two interactive processes: domestic learning and learning abroad. The combination of them may generate positive synergies that reinforce the use of M&As by EMNE over other forms of internationalisation. The empirical analysis is built from factor analysis and cluster, and dynamic panel data methodology for a sample of 78 countries, including both developed and developing economies. With empirical analysis we demonstrate how M&A outflows may compensate for domestic weaknesses in less-advanced home NSIs through technological catch-up, and how inward foreign direct investment has contributed a positive influence.