We examine the effect of foreign institutional investors on firm innovation. Using firm-level data across 26 non …-U.S. economies between 2000 and 2010, we show that foreign institutional ownership has a positive, causal effect on firm innovation …. We further explore three possible underlying mechanisms through which foreign institutions affect firm innovation …

In the last two decades, the world has witnessed the rise of Chinese innovation. China, once a manufacturing hub for … for innovation. Our findings suggest that imitation is a path to indigenous innovation only in low-tech (simple …