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RESEARCH CENTRE FOR INDUSTRIAL DEVELOPMENT PROBLEMS of NAS of Ukraine (KHARKIV, UKRAINE)

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Liburkina L. M.

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Localization of R&D and High-Value-Added Functions of Multinational Enterprises as a Driver of Technological Development in Host Countries
Ishchuk Y. A., Bulka D. Y.

Ishchuk, Yuliia A., and Bulka, Daria Yu. (2026) “Localization of R&D and High-Value-Added Functions of Multinational Enterprises as a Driver of Technological Development in Host Countries.” Business Inform 5:70–80.
https://doi.org/10.32983/2222-4459-2026-5-70-80

Section: Mechanisms of Regulation of the Economy

Article is written in Ukrainian
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UDC 330.341.1:339.727.22

Abstract:
The study is dedicated to analyzing the impact of R&D localization and high-value functions of multinational corporations (MNCs) on the technological development of recipient countries within the system of international economic relations. The study explains the contains of R&D localization as a way to deepen the host country’s participation in global value chains and highlights the key high-value functions of MNCs that create long-term technological effects, including engineering design, digital and analytical units, product management, high-tech market marketing, knowledge service centers, and corporate innovation management. The main channels through which R&D localization affects the national innovation system are summarized, including technology transfer, knowledge diffusion through supply chains, upgrading human capital skills, forming collaboration networks with universities and research institutions, and developing local startup ecosystems. It has been shown that the technological benefits for the recipient country depend on the quality of institutions, protection of intellectual property rights, availability of STEM professionals, the depth of local production and scientific cooperation, and the ability of government policy to specifically boost the country’s role within global value chains. The risks of «limited localization» have been analyzed, where TNC investments focus on low-value operations, weakening the impact on national companies’ productivity and innovation. Directions for government policy have been identified to attract TNCs to set up R&D centers and high-value functions through the development of innovation infrastructure, tax and investment incentives with local partnership conditions, support for applied research, and standardization of business-science interaction mechanisms.

Keywords: multinational corporations; R&D localization; high-value-added functions; technology transfer; global value chains; innovation system; recipient countries; foreign direct investment.

Fig.: 3. Tabl.: 4. Bibl.: 17.

Ishchuk Yuliia A. – PhD, Associate Professor, Associate Professor, Department of International Economic Relations, Vasyl’ Stus Donetsk National University (21 600-richchia Str., Vinnytsia, 21021, Ukraine)
Email: [email protected]
Bulka Daria Yu. – Student, Vasyl’ Stus Donetsk National University (21 600-richchia Str., Vinnytsia, 21021, Ukraine)
Email: [email protected]

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