Are the BRIC countries overtaking intermediate countries in the race for international R&D? The case of Spain

ABSTRACT

The emergence of Brazil, Russia, India and China (BRIC) as international locations for foreign direct investment in R&D is a sign that multinationals are relocating their technological activities to new territories. This trend may weaken the supremacy of the developed countries until now considered leaders in innovation, and may mean the loss of the competitive advantages enjoyed by the countries considered intermediate innovators. This paper examines the situation of Spain as a typical intermediate economy and compares it to its main competitors among the BRICs. Based on eight case studies of subsidiaries with R&D centres in Spain, we conclude that the policies adopted by certain emerging economies to develop their national innovation systems are proving effective and that these countries now pose a threat to intermediate economies. However, the BRICs still lag behind in terms of the security of their institutional framework; this situation leaves intermediate countries in an advantageous position.

KEYWORDS:

• R&D
• multinationals
• international location factors
• innovation

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Paloma Miravitlles is associate professor at the University of Barcelona (UB). Her main research interest is the field of international business; she focuses in particular on the strategies of multinationals and foreign subsidiaries and internationalisation of innovation.

Fariza Achcaoucaou is assistant professor at the UB. Her main research interest is the study of international business and innovation, notably the transfer of knowledge within multinationals and embeddedness.

Ana Núñez-Carballosa is associate professor at the UB. Her main research interest is the study of the strategic behaviour of foreign multinationals.

Laura Guitart-Tarrés is associate professor at the UB. Her main research interest is the location factors of foreign branches established in Spain.

Claudio Cruz-Cázares is a visiting professor at the UB. His research interests are in the field of innovation strategies and open innovation.

Notes

1 There has been significant disinvestment in Spanish public R&D budgets for R&D since the financial crisis. Public R&D funding reached its highest level in 2009 (€8700m) but by 2013 had fallen by 39%, returning to the levels of 2005–2006 (RIO 2015).

2 For example, according to the OECD, real GDP annual growth in Spain was −0.62% in 2011, compared with 4.26% in Russia and 9.30% in China.

3 According to the OECD, the number of full-time researchers per thousand employees rose by 52.67% between 2000 and 2012, but in emerging countries, the rate was considerably higher, reaching 90.63% in China.

4 Between 2004 and 2014, Spain ranked 9th out of 150 countries in terms of the number of scientific articles published, below China (2nd position) but above India (10th), Brazil (14th) and Russia (15th) (Essential Science Indicators. Thomson Scientific).

Additional information

Funding

This study was made possible thanks to the collaboration of the Fundación I+E (Innovation+Spain Foundation) and funding from the Fundación Española para la Ciencia y la Tecnología, FECYT (Spanish Foundation for Science and Technology of the Ministry of Economics and Competitiveness) [307280].