Technology and Strategic Motivations for Investment in Transition Economies

This is the first of two chapters that review the ways in which MNEs apply, acquire or generate technology in their CEE operations, positioning this in terms of the broader strategic dimensions of their initial entry to, and subsequent evolution in, these transition economies. The next section discusses MNE HQ survey evidence on the relative prevalence of the four strategic motivations (introduced in the previous chapter) in the original activity of their subsidiaries in CEE, and also provides some indication of how the balance of these may evolve as the host region changes and develops. We then discuss in detail, for the first time, the seven sources of technology that are seen as available to MNEs’ subsidiaries. These can be grouped as of three broad types; those available from the parent MNE group (technology transfer); existing technology available in CEE, either as capabilities of local firms or as tacit knowledge (distinctive skills) embodied in local labour (for example engineers or technicians); and technology that MNEs can generate in these economies through in-house or externally collaborative R&D.