How does “what managers know” affect firm performance on international markets? This question is of considerable importance in the international economic literature. Answering it will be key for comprehending the way firms' varying performance on international markets is shaped by the human...

This paper analyses the development of the ratio of corporate taxes to wage taxes using a simple political economy model with internationally mobile and immobile firms. Among other results, our model predicts that countries reduce their corporate tax rate, relative to the wage tax, either when...

This paper considers the effect of acquisition FDI on the knowledge production function. We distinguish between acquisitions by MNEs from technologically leading countries and those behind the technological frontier. We show that both acquire similarly R&D intensive domestic firms, but there are...

When countries compete for the location of a new multinational plant they need to be aware of the profit shifting opportunities this new plant creates for the global multinational firm. By modelling explicitly the multinational's intra-firm transactions, we show that the home market advantage...

Recent research in international economics highlights the role of interdependencies of investment decisions and sales of multinational firms. Previous work focused on and provided evidence for aggregate flows or stocks of foreign direct investment, showing that interdependence declines in...

Intellectual Property Rights (IPR) protect firms from imitation and are considered crucial to promote innovation and technological diffusion. This paper examines the impact of IPR on import sourcing decisions of multinationals. We consider a framework in which firms offshore production of an...

In recent decades, a large and increasing number of leading firms in a diverse set of industries have faced allegations of ‘unethical' practices along their international value chains. In many cases this has triggered consumer boycotts and NGO campaigns, introducing a new link between upstream...

In this study, we estimate the impacts of differences in international tax rates on the probability of choosing a location for an affiliate of a multinational firm. In particular, we distinguish between the tax sensitivity of Greenfield and M&A investments. Based on a novel firm-level dataset on...