Technology origins of foreign-owned firms in Ohio

Do foreign-owned firms transfer non-US technologies to their US subsidiaries or do they rely primarily on US technologies? The effects of foreign-owned firms in the United States on US technological capability have been controversial. We investigate the country origins of the present and initial technologies of foreign-owned firms in Ohio and explain statistically, using survey data, why the country origins of these firms' technologies might have differed. Consistent with direct foreign investment (DFI) theory, for most firms, both the present and initial technologies have been sourced from their parent-firm countries. Although the statistical explanations of the differences in the country origins of initial and present technologies differ according to CHAID (Chi-squared Automatic Interaction Detector) and logistic regression analyses, they are fully consistent with each other. Relative importance of exporting is associated with US technologies, as we would expect from comparative advantage theory, whereas relative importance of importing is associated with foreign technologies, which can be attributed to the foreign input requirements of such technologies. Moreover, greenfield investments are more likely than brownfield investments to have a foreign country as the origin of the initial technology. This result, too, is consistent with direct foreign investment (DFI) theory. These results are statistically independent of specific home countries and firm size.