Key determinants of the mode of international technology transfer: evidence from India and Turkey

Abstract

An important issue in international technology transfer research is to explain why firms choose a particular mode of technology transfer. The factors advanced in the literature focus on a firm's resource dependencies and transaction cost. We believe the mode of technology transfer is embedded in managerial, political, social and national context. The objective of the study is to identify factors considered for different modes and explain the contingencies under which either set of factors would drive a particular choice. Specifically, in this study we study the factors affecting international licensing agreements and joint ventures in India and Turkey. Results from the study indicate licensing was the mode of transfer, since the recipient's firm's belief in its absorptive capacity was high, it was endowed with slack resources and technology market competition was high. The contingent factors were government policies and resolution influence of the donor. The joint ventures were established when the recipient's resources were weak (resource dependency high), when top management was committed to faster growth and donors had invested significant R&D. An important factor underlying joint ventures, especially for a related technology of technical complexity was that these technologies were bundled together with the participants having past experience of sharing common technology with a recipient.