The income of Puerto Rican affiliates of U.S. corporations is essentially untaxed by either Puerto Rico or the U.S. This lowers the tax penalty on real investment there, and also makes it attractive to shift reported taxable income from the U.S. parent corporation to the Puerto Rican affiliate....

The purpose of this paper is to examine the relations among characteristics of U.S. firms, their tendency to invest abroad, and their choice of production locations. The larger the firm, and the higher its profitability, capital intensity, technological Intensity, and the skill level ofits labor...

Swedish firms acquired by foreigners were considerably larger than the average firms in their industries. They were relatively low in value added per employee at the time of takeover and before, a characteristic we take to indicate relatively low profitability, capital intensity, or...