Communication Frictions and Knowledge Transfers: Evidence from FDI

This paper examines knowledge transfers from foreign managers to domestic managers within MNCs. Using a newly developed survey of domestic middle managers in Myanmar, we find evidence of large communication frictions between management layers: foreign managers cannot speak Myanmar, domestic managers cannot speak the company's language (e.g., Japanese, Korean or Chinese), and both groups are not well versed in English. These frictions impose costs on MNCs and impede knowledge spillovers to domestic managers.

• EDS
• Amit Khandelwal
• Communication Frictions