In this paper we analyze the conditions under which a foreign direct investment (FDI) involves a net capital flow across countries. Frequently, foreign direct investment is financed in the host country without an international capital movement. We develop a model in which the optimal choice of...

In this paper we measure knowledge spillovers arising from venture-capital financed companies on the patenting activities of other companies and compare them to spillovers from established firms. We develop a novel measure to to identify the appropriate spillover pool based on backward citations...