Multinational enterprises' transfer of R&D capabilities to their international joint ventures in the less developed countries has been an emerging phenomenon. The purpose of this study is to understand the transfer of R&D capabilities between organizations embedded in drastically different...

We use incentivized economics experiments to test both the point predictions and comparative static predictions of optimal transfer pricing models, comparing behavior under varying conditions, including wholly versus partially-owned subsidiaries and different tariff and tax rates. As predicted,...