Technological spillovers from multinational presence - Towards a conceptual framework

This paper undertakes a critical review of existing spillover analyses and proposes a unique analytical framework for examining technological spillovers in a manufacturing industry setting. The proposed framework overlaps three different literature strands; cluster and network dynamics, technological innovations; and spillover literature. It enables determination of the extent to which multinational presence in a host country stimulates spillover occurrence to local firms as well as their nature. Using this framework, the kind and the channels through which spillovers occur most can be equally determined - this is particularly relevant for policy intervention in a technically backward country. Lastly, it allows determination of factors and conditions under which spillovers from multinationals occur.

Keywords: Multinational presence, spillover index, learning, network dynamics, capability building and innovation.

JEL Classification: C4, F2, L1, L2, L6, O1, O3