Are “the best” foreign subsidiaries cooperating for innovation with local partners? The case of an intermediate country

Abstract

We analyse, over 2004-2008, a sample of firms representative of Spanish manufacturing industry, in order to understand the relationship between foreign status and local cooperation for innovation. More specifically, we focus on foreign subsidiaries displaying innovation intensity, newness of technology or ability to build complex networks with local innovators. Foreign status increases the probability of local cooperation for innovation. However, foreign subsidiaries displaying the abovementioned characteristics are not necessarily more prone to cooperate locally for innovation than similar affiliated domestic firms. FS are able to build complex cooperative networks with local partners but multi cooperative FS are not especially interested in fast changing sectors. In contrast to cooperative affiliated domestic firms, the distribution of cooperative FS tends to be even across sectors and this is confirmed for advanced FS. This suggests that FS look for general capabilities in local partnerships, rather than for specific expertise. The strategies of domestic affiliated firms seem to influence the relationship between foreign status and local cooperation for innovation.