Leaders, laggards and technology seeking strategies

► We model optimal technology seeking strategies of leading and lagging firms in international duopoly. ► We find that laggards optimally engage in exports and leaders in FDI for a wide range of different parameter settings and assumptions. ► Exploratory case studies and some novel econometric analysis support the implications of our model. ► Our results bridge the gap between the established theory in this literature and some recent contrasting empirical evidence.