Analyzing R&D Activities of Foreign Enterprises in Emerging Economies. Lessons from Turkey

Abstract

Emerging economies have played an important role in the internationalization of R&D activities at least since the 1990s. Turkey, an emerging economy and at same time an accession country to the European Union which signed a Customs Union Agreement with the EU already in 1995, is no exception. In-depth face-to-face semi-structured interviews were conducted with R&D directors of 26 multinational companies operating in Turkey –with headquarters located in France, Germany, Italy, Japan, Switzerlandand USA- in the informatics, automotive, electronics and pharmaceutical industries. Data and qualitative information obtained through these interviews are then used to analyze those factors theory points to as being major determinants of foreign R&D in emerging economies. The emphasis is on the (i) motivations of foreign enterprises for launching new R&D activities or extending existing ones (ii) restrictions of different kind they encounter in doing so (iii) their reactions with respect to FDI promotion policies and public R&D support incentives implemented by Turkish policy makers, and (iv) advantages/disadvantages of Turkish economy as an R&D location in comparison with other emerging economies. A number of policy recommendations for attracting more foreign R&D in Turkey and integrating them with the Turkish national innovation system are advanced.Research and development (R&D), internationalization of R&D, R&D offshoring, multinational companies, national innovation systems, case studies, semi-structured interviews