Sanna Ojanperä | Searcharxiv

arXiv2021

The role of relatedness and strategic linkages between domestic and MNE sectors in regional branching and resilience

Despite the key role of multinational enterprises (MNEs) in both international markets and domestic economies, there is no consensus on their impact on their host economy. In particular, do MNEs stimulate new domestic firms through knowledge spillovers? Here, we look at the impact of MNEs on the entry and exit of domestic industries in Irish regions before, during, and after the 2008 Financial Crisis. Specifically, we are interested in whether the presence of MNEs in a region results in knowledge spillovers and the creation of new domestic industries in related sectors. To quantify how related an industry is to a region's industry basket we propose two cohesion measures, weighted closeness and strategic closeness, which capture direct linkages and the complex connectivity structure between industries in a region respectively. We use a dataset of government-supported firms in Ireland (covering 90% of manufacturing and exporting) between 2006-2019. We find that domestic industries are both more likely to enter and less likely to leave a region if they are related to so-called 'overlapping' industries containing both domestic and MNE firms. In contrast, we find a negative impact on domestic entry and survival from cohesion to 'exclusive MNE' industries, suggesting that domestic firms are unable to 'leap' and thrive in MNE-proximate industries likely due to a technology or know-how gap. This dynamic was broken, with domestic firms entering MNE exclusive sectors, by a large injection of Brexit diversification funds in 2017-18. Finally, the type of cohesion matters. For example, strategic rather than weighted closeness to exclusive domestic sectors matters for both entries and exits.

econ.GN↗

arXiv2021

Is academia becoming more localised? The growth of regional knowledge networks within international research collaboration

It is well-established that the process of learning and capability building is core to economic development and structural transformation. Since knowledge is `sticky', a key component of this process is learning-by-doing, which can be achieved via a variety of mechanisms including international research collaboration. Uncovering significant inter-country research ties using Scopus co-authorship data, we show that within-region collaboration has increased over the past five decades relative to international collaboration. Further supporting this insight, we find that while communities present in the global collaboration network before 2000 were often based on historical geopolitical or colonial lines, in more recent years they increasingly align with a simple partition of countries by regions. These findings are unexpected in light of a presumed continual increase in globalisation, and have significant implications for the design of programmes aimed at promoting international research collaboration and knowledge diffusion.

cs.SI↗