Multinational Firms - EstAblisidng Local R&D - Production Linkages in the Indian Context-

Abstract

A primary motivation for monetization of knowledge is the development of suitable linkages that enable commercial exploitation of the utility embodied in an inventive product or process. While much has been said about what monetization is and its significance, relatively less is said of the interdependencies that produce it and the mechanisms underlying it i.e. knowledge transfer. A current shift of Innovation activities towards emerging economies has highlighted the importance of the value chain processes and the elements that support monetization. Undoubtedly, Multinationals have emerged as key actors, but questions remain whether domestic firms and the Informal Sector comprising the bulk of Industrial output in India have been able to move up the value chain ladder or not. This is attributed to piecemeal technological upgrading efforts, together with a relatively reduced emphasis on employing innovative products and processes, seen in practice. The latter is on account of excessive dependence on external sources of information, with limited learning opportunities. The Paper seeks to identify the missing links to enable the benefits derived from participation in global value chains.