Regional embeddedness of multinational enterprises in european regions

It is often argued that multinational enterprises (MNEs) act space-less in the global economy and that they are an essential mechanism in the internationalization of the transfer of knowledge and technologies. The existence of international inner-organizational learning and synergy effects distinguishes MNEs from market-based exchange relationships and national companies (The Oxford Handbook of Innovation, 2005). With their knowledge accumulating and processing capacities, MNEs can use product, production, distribution, and development competences, which they accumulated in their homeland and in all other socio-cultural and institutional contexts where branch plants are located. In this respect, MNEs can combine the advantages of globally-coordinated product and production strategies with the advantages of local proximity and specific locational factors (Management International Review 40:127-148, 2000). This contribution deals with the regional embeddedness of MNEs in their innovation activities. We depict those regional characteristics which either show a high or a low propensity for the location of MNEs and for which a high or low regional embeddedness of the enterprises could be anticipated.