To the best of our knowledge, there is no host
government that has methodically tried to encourage
foreign affiliates to import technology by using competition
and education policies instead of formal
requirements, so it is not possible to compare the
effects of the various types of policy intervention.
There is, however, a large variation in requirements,
competition, education, and other characteristics
across host countries, and it should be possible to
observe systematic crosscountry differences in the
affiliates’ technology imports if these characteristics
influence the marginal costs and benefits of technology
transfer in the way hypothesized by the Wang-
Blomstrom model. In this paper, we will therefore
examine how the technology imports of US majorityowned
foreign affiliates in 33 host countries are
related to proxies for the host countries’ requirements,
levels of local competition, and leaming capabilities.’
The results are intended to provide some insights
about how host countries can persuade foreign-owned
multinationals to bring more technology to their
affiliates.