2 management - School of International Business and ...

Günter S. Heiduk
strategic alliances form the institutional framework. Clusters are also attraction poles for foreign
high-skilled workers. As a result, clusters create cross-border knowledge outflows, most often
through licensing. New cluster-type cooperation projects emerge in pre-commercial R&D, such
as the European Strategic Programme for Research and Development in Information Technol-
ogies (ESPRIT). The complexity, high financial and scientific risks of R&D in new technologies
as well as the discontinuity between R&D and the commercialization of research results exceed
the capacity of single enterprises. It seems that the barriers at the beginning of these types of
international collaborative team work (which often result from cultural differences) are vanishing.
The internationalization in higher education plays an important role. More than half of graduates
in engineering in the U.S.A. are foreign nationals. A large part starts their professional career
outside their home country.
At first view clusters appear like a »club«of actors who cultivate open internal cooperation but pro-
tect their network by establishing formal and informal barriers. Empirical studies mostly concen-
trate on the aspect of internal openness by analyzing technology spillovers, especially through
labor mobility [Fosfuri/Ronde, 2004]. Several studies on the Silicon Valley focus on the brain
gain by immigration [Saxenian, 2002]. Most recently there are indications of a rising brain drain
by emigration of former immigrants or by graduated students returning to their home countries.
Besides brain gain and brain drain a third way of cross-border knowledge transfer is brain cir-
culation. Indian and Chinese engineers working in Silicon Valley established business networks
with companies in their home countries thus providing a more flexible and responsive mechanism
promoting cross-border technology transfer compared to FDI outflows [Saxenian, 2002a]. The
integration of the Silicon Valley into the world economy is not restricted to knowledge spillovers,
FDI, migration, but also includes exports. Silicon Valley is on the top of metropolitan areas in
the U.S.A. with 27.7 percent of its workforce tied to exports [Istrate et al., 2010, p 10]. With 20.1
percent share of exports in its production, Silicon Valley is ranked third among the large met-
ropolitan regions. The exports grew at an annual rate of 5.5 percent between 2003 and 2008.
In addition to the proven evidence of local knowledge spillovers in geographically defined clusters
recent studies are focusing on international knowledge spillovers that result from the cross-bor-
der fragmentation of the value chain in MNCs (model two). Opposite to the centripetal forces
that tend to concentrate industries regionally there also exist centrifugal forces that disperse
industries evenly across borders. The MNCs are the driving forces of the international dispersion
of industries by linking cross-border externalities with their international activities such as FDI,
foreign patenting, international R&D collaboration. The international dispersion of R&D in the
electronic, chemical and aircraft industry is the latest trend in multinationalization. Expatriate
laboratories in different countries exploit the local externalities without major local interaction, but
create widespread knowledge spillovers. »The persistent increase of R&D costs has been the
major centrifugal force for the aircraft global decentralization: in order to reduce R&D costs, the
industry has been gradually implementing strategies of international cooperation«[Niosi/Zhegu,
2004, p 6]. In the long-term, governments in the host countries of foreign R&D facilities may be
interested in supporting technology spillovers as an instrument to build up a national aircraft
140