Krautheim, Sebastian - In: Canadian Journal of Economics 46 (2013) 4, pp. 1571-1605
A large fraction of affiliates owned by multinational manufacturing companies operate in the wholesale and retail sectors. This paper proposes a model of trade, horizontal FDI, and export-supporting FDI (ESFDI). ESFDI reduces distribution costs abroad, while production remains at home. ESFDI...