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patterns. First, foreign affiliate and headquarter sales exhibit strong positive comovement: a 10% growth in the sales of the … headquarter is associated with a 2% growth in the sales of the affiliate. Second, shocks to the source country account for a … significant fraction of the variation in sales growth at the source-destination level. We propose a parsimonious quantitative …
Persistent link: https://www.econbiz.de/10012984125
We use a unique firm-level panel data set of multinational parents and their foreign affiliates to analyze whether profits are shared across borders within multinational firms. Using both fixed-effects and generalized method-of-moments estimators, affiliate wage levels are estimated to respond...
Persistent link: https://www.econbiz.de/10013217919
multinational affiliates, as well as with higher aggregate affiliate sales to the local market, back to the U.S. and to third … affiliates, by contrast, these forces are associated with relatively lower local sales and higher return and third-country sales …. Yet at both aggregate and affiliate levels, the share of local sales in total sales is smaller, while the shares of U …
Persistent link: https://www.econbiz.de/10013055496
firms to serve foreign markets either through exports or local subsidiary sales (FDI). These modes of market access involve … different relative costs, some of which are sunk while others vary with sales volume (such as transport costs and tariffs … aggregate export and FDI sales relative to the domestic and foreign market sizes. In particular, it is shown that firm level …
Persistent link: https://www.econbiz.de/10013232882
The U.S. Bureau of Economic Analysis (BEA) estimates the return on investments of foreign subsidiaries of U.S. multinational companies over the period 1982--2006 averaged 9.4 percent annually after taxes; U.S. subsidiaries of foreign multinationals averaged only 3.2 percent. Two factors distort...
Persistent link: https://www.econbiz.de/10012759325
This paper provides a general and unified framework to study the role of production networks in international GDP comovement. We first derive an additive decomposition of bilateral GDP comovement into components capturing shock transmission and shock correlation. We quantify this decomposition...
Persistent link: https://www.econbiz.de/10012867903
Countries that are more engaged in production sharing exhibit higher bilateral manufacturing output correlations. We use data on trade flows between US multinationals and their affiliates as well as trade between the United States and Mexican maquiladoras to measure production-sharing trade and...
Persistent link: https://www.econbiz.de/10012759633
U.S.-owned manufacturing affiliates in foreign countries tended to become more export-oriented between 1966 and 1977. The shift toward exporting characterized affiliates in most industries and most countries.The bulk of U.S.-owned production abroad continues to be for local sale in most...
Persistent link: https://www.econbiz.de/10013230213
In recent decades, growth of overall world trade has been driven in large part by the rapid growth of trade in …
Persistent link: https://www.econbiz.de/10013218078
Affiliate-level evidence indicates that American multinational firms circumvent capital controls by adjusting their reported intrafirm trade, affiliate profitability, and dividend repatriations. As a result, the reported profit impact of local capital controls is comparable to the effect of 24...
Persistent link: https://www.econbiz.de/10012785792