TECHNOLOGY FLOWS AND FOREIGN INVESTMENT IN THE AUSTRALIAN MANUFACTURING SECTOR.

This paper reports the results of a study, based on a questionnaire survey, designed to provide information about these issues associated with the technology dimension of foreign direct investment in the Australian manufacturing sector. The questionnaire was designed to provide data on a number of aspects of actual technology characteristics of foreign-direct-investment subsidiaries in Australian manufacturing, as welt as form the basis for some limited statistical tests of various hypotheses associated with the technology dimension of foreign direct investment. In particular, information was collected on the following: (a) The extent of R&D undertaken by subsidiaries in Australia and the influence of several characteristics of foreign subsidiaries on the level of R&D and the type of R&D undertaken. (b) The source of funds for R&D undertaken by subsidiaries, and the role of the Commonwealth Government's Industrial Research and Development (I.R.&D.) grant scheme in fostering domestic R&D by foreign subsidiaries. The extent to which I.R.&D funds have been directed to modifying overseas technology. (c) The channels of access to new overseas technology used by subsidiaries and the terms of access to affiliate and non-affiliate technology. One major issue is the differences, if any, in the restrictions imposed by affiliates, on the one hand, and non-affiliated firms on the other hand, on the use of imported technology. The extent of outward technology flows to both affiliated and non-affiliated firms overseas, and the importance of technology-swap arrangements. (d) The extent of export activity by foreign subsidiaries, including the role of restrictions on exporting attached to technology agreements encompassed by the general restrictions in (c), above. In particular, an important issue is whether export restrictions are more prevalent with affiliate or with non-affiliate technology agreements. [ABSTRACT FROM AUTHOR]