Evaluating differences in technological activity between transnational and domestic firms in Latin America

This study uses a sample of Latin American firms from four areas to compare the performance and technological activity of transnational to domestic firms. After accounting for scale, age and location of firm, we find few differences in either traditional methods of growth or profitability or in implementation of new technology embodied in processes or products. There are important differences in the sources of new technology. Domestic firms have a relatively higher level of internal innovative activity, whereas foreign firms rely more heavily (but not exclusively) on sources external to the subsidiary.