Title: Learning from foreign TNCs: a study of technology upgrading by local suppliers to AB Volvo in Asia and Latin America

Authors: Inge Ivarsson, Claes Goran Alvstam

Addresses: Department of Human and Economic Geography, School of Business, Economics and Law, Box 630, S-405 30 Goteborg, Sweden. ' Department of Human and Economic Geography, School of Business, Economics and Law, Box 630, S-405 30 Goteborg, Sweden

Abstract: Our data from local suppliers to AB Volvo|s truck and bus-plants in Brazil, China, India and Mexico show that foreign TNCs contribute to technology-learning and improved adaptive technological capabilities, which help suppliers to expand businesses with domestic and international OEM-customers in many industries and markets. This support the evolutionary perspective that technology transfers from industrialised to developing economies are based on local inter-firm linkages arising from regular manufacturing activities of foreign TNCs. A policy lesson is that business-linkages with foreign TNCs with a low-volume demand for high-quality products can result in technology-upgrading among small local suppliers who make necessary learning-investments.

Keywords: international technology transfer; inter-firm learning; foreign TNCs; local suppliers; developing countries; transnational corporations; technology learning; AB Volvo; Brazil; China; India; Mexico; technological capabilities; technology management; small firms; technology upgrading.

DOI: 10.1504/IJTM.2009.024600

International Journal of Technology Management, 2009 Vol.48 No.1, pp.56 - 76

Available online: 10 Apr 2009 *

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