We propose and empirically test a novel trade credit channel through which the presence of foreign-owned firms can propagate international liquidity shocks to a local country despite its tight controls over portfolio flows. A well-documented advantage of foreign-owned firms, especially large...

We empirically investigate the impact of product quality information asymmetry on firm exports and the sectoral composition of multinational corporation activities. Using Chinese customs data, we find robust evidence that foreign firms perform better than domestic firms in information intensive...

We study the distributional effects of preferential tax policies for FDI using China’s corporate income tax unification reform as a natural experiment. We first present a simple model to motivate our empirical analysis. Using a differential exposure approach, we then show that eliminating...