ABSTRACT
Multinational firms from the US, Japan, and Sweden have accounted for increasing shares of exports from developing countries as well as from the world as a whole. Although research and development (R&D) expenditures within affiliates, and especially within developing country affiliates, by US multinationals are small relative to those at home, they might be large relative to the host countries’ R&D efforts. Electrical machinery companies investing in developed countries reported larger sales by uncontrolled companies under license than those investing in developing countries, even though the latter spent more heavily on R&D. The more R&D intensive US affiliates in a country are, the larger the proportion of high-technology industries in the country’s exports and the smaller the share of low-technology industries. These relationships are present even after the level of real output per capita and the country’s endowment of high-skill workers are taken into account.
