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This study examines the conditions that influence the extent of knowledge collaborations within the MNC. We build our model by drawing on the literature on subsidiaries and headquarters role in innovation, to determine the extent of subsidiary collaborations with the HQ. We hypothesize that characteristics of the subsidiary related to its collaborative experience - the extent and the nature of experience - time compression and external focus - influence the extent of collaborations, due to the potential for knowledge leveraging and protection. We further propose that the distance between the intellectual property regimes of the host country, where the subsidiary is located and the home country, where the HQ is located, determines the extent of collaboration because of ramifications for knowledge protection. Subsidiary characteristics are expected to moderate the relationship between distance in intellectual property regimes and extent of collaboration, with prior collaborative experience weakening this relationship, and time compression and external focus strengthening this relationship. We test our hypotheses in an overseas subsidiary-HQ dyad level of analysis, involving U.S. semiconductor firms. Our results largely support our hypotheses, with negative effects of time compression, external focus and distance between intellectual property regimes on the extent of collaboration. We also find support for moderator roles of subsidiary collaborative experience and time compression. [ABSTRACT FROM AUTHOR]

Despite concerns of leakage of Intellectual Property (IP), multinational firms are increasingly offshoring research and development activity to developing countries with weak Intellectual Property Regimes (IPRs). This paper examines how the strength of the IPR at an offshore location influences the nature of multinational R&D activities in that location. We argue that, on average, the weaker the IPR at the offshore location, multinational firms are more likely choose to perform in that host location R&D projects that are more valuable to the firm than to its competitors and are less likely to build on the firm's prior knowledge. We also argue that in offshore locations with weak IPRs, this type of project selection is even more likely when the R&D project is aimed at the offshore market and is less likely when the project is aimed at the firm's headquarters location. We test our theory using a novel dataset of patents assigned to US multinationals that were partially or fully offshored to India or to the UK, and were filed in the US or at the offshore location (India or UK). We thus contribute to a better understanding of multinationals R&D strategies in offshore locations. [ABSTRACT FROM AUTHOR]