market is a Cournot oligopoly. Due to a fixed supply of skilled labor in each country, such foreign direct investment (FDI …) raises the host wage and reduces the source wage. A subsidy to FDI results in higher profits for source firms but lower … profits for host firms. Thus, each country experiences conflict in setting its policy toward FDI. Workers favor inward FDI but …

This paper agrues that the prices of intermediates may influence the pattern of foreign direct investment (FDI). In our … model, two downstream firms select whether to serve each other's markets through exports of FDI, always sourcing the … fact that two-way FDI occurs when the market sizes of the two countries are similar. Welfare analysis provides two …

We study the impact of foreign direct investment (FDI) policies when source firms locate some production in two host … countries. By reducing its tax on multinational production, a host country can attract additional FDI, some of which is diverted … from other host countries. The shift in FDI causes host wages to rise while wages elsewhere fall. The host country with the …

Recent evidences show the co-existence of lower trade cost and higher amount of foreign direct investment (FDI), which … country markets are important to the foreign firm, lower trade cost may increase FDI if the foreign and the host country firms … differ in technologies. Whether lower trade cost increases welfare is ambiguous, and depends on its effects on FDI. We also …

acquisition. We find that with quantity competition a spillover makes acquisitions less attractive, while with price competition … acquisitions become more attractive. Asymmetric information about potential spillovers always reduces the number of acquisitions …

government has an incentive to attract FDI due to technology transfer to local firms or the wage premium earned by employees of … the multinational firm. However, when FDI is particularly attractive to the multinational firm, the host government has an … incentive to discourage FDI …

the literature on trade and foreign direct investment (FDI) hardly pays attention to this aspect. We develop a simple … model to show how better governance affects inward FDI and domestic welfare. We find that whether better governance in the … domestic country attracts inward FDI depends on the way it affects the costs of the firms. The effect of better governance is …

firms agglomerate in the foreign market (North-South FDI) and the optimal government intervention by the North is a zero … levels, the optimal tariff policy is such that both firms agglomerate in the domestic country (North-North FDI). …