Theoretical considerations suggest that the option of waiting under conditions of uncertainty affects the relative importance of firm-level productivity and distance-related transaction costs as driving forces of FDI. Yet the timing of FDI has received little attention in the empirical...

Several developing countries impose high tariffs, directly or indirectly, on imports of manufactured goods such as vehicles and machinery. In many cases governments argue that they need such policies to protect domestic manufacturing industries from foreign competition while simultaneously...