Correlation Between Industrial R&D Expenditure and Its Propensity of Technology and Knowledge Transfer in Malaysia, Singapore and Taiwan

Global research and development (R&D) spending has increased as the need for new technologies has grown and intense competition with fast structural changes in the market. A total of US$1.6 trillion has been invested on R&D around the world, the expenditure of which is crucial in today’s dynamic business environment. The R&D would not be possible without proper funding as well as effective technology and knowledge transfer to assists in technology commercialization. Therefore R&D and its technology transfer, as well as the associated knowledge transfer are perceived to have an important relationship. This paper aims to analyse the correlation between the industrial R&D expenditure and its propensity of technology and knowledge transfer in Malaysia, Singapore and Taiwan. The research is based on the analysis of secondary data from published annual reports, official websites of organisations and financial statements, followed by a quantitative analysis of primary data using a survey questionnaires administrated to respondents selected via purposive sampling. Several critical determinants and important aspects of R&D expenditure and activities were identified and both their positive and negative impacts were discussed and subjected to statistical analysis. The research found that the bulk of the R&D expenditure was from the top ten organisations and top five industries for each country despite there being more than 100 companies and 20 industries having R&D expenditure. The findings also revealed that the organisations’ readiness in terms of technology capabilities and people capabilities is still weak in Malaysia and Singapore as compared to Taiwan. Overall, the findings indicated that there is no correlation between industrial R&D expenditure and the propensity of technology and knowledge transfer in Malaysia and Singapore, but a correlation exists in the case of Taiwan. This study suggests that upgrading an organisation’s technological and people capabilities as well as having an effective technology management and operational strategy would greatly improve an organisation’s performance in R&D, technology transfer and knowledge transfer and its sustainable development