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We derive gravity equations from three different general equilibrium models incorporating multinational firms. We show that gravity equations are particularly adapted to the analysis of foreign affiliates' activities of multinational firms. However, the different theoretical models lead to...
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foreign direct investment (FDI) across European Union (EU) member states. Based on the knowledge-capital model, the study … employs the Pseudo Poisson Maximum Likelihood (PPML) estimator and panel data to examine empirically the determinants of FDI … Member State induces MNEs to undertake FDI in that country, while worse economic sentiment in an EU member state motivates an …
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