The role of the environment in the location of R&D and innovation activities in subsidiaries of foreign multinationals

The internationalisation of R&D activities in foreign countries different from their multinational headquarters is a difficult decision. The local environment plays a crucial role in that decision. Based on a case study methods and the examination of seven subsidiaries with excellent research centres in Spain, the results show that aspects related to technology supply have a greater power of attraction than aspects related to market demand. However, the Spanish environment is more attractive in terms of demand factors than supply factors. As a result, Spain occupies an intermediate position in attracting foreign direct investment in R&D and innovation.