We analyze a model that focuses on the export/outsource decision. Outsourcing has the advantage of providing better information about local preferences. The disadvantage is that producing in the host country also means using the inferior technology embodied in the local capital. The decision of...

Multinational labor demand responds to wage differentials at the extensive margin, when a multinational enterprise (MNE) expands into foreign locations, and at the intensive margin, when an MNE operates existing affiliates across locations. We derive conditions for parametric and nonparametric...

The routine way of anticipating the effects of the corporate (profit) tax on investments and location choice is to calculate the effective marginal and average tax rates. This paper introduces a model of monopolistic competition to show how investment on the extensive and intensive margins...

Recent theoretical approaches stress the importance of complex integration strategies of multinationals and the interdependence between locations. Up till now little has been done to incorporate the potential cross-country dependencies into the empirical analysis of the determinants and the...

This paper examines how free-trade agreements and customs unions affect the location of foreign direct investment (FDI) and social welfare, taking into account that governments may adjust taxes and external tariffs to compete for FDI. Conditions are identified under which a free-trade agreement...

The present paper investigates the effect of linguistic distance on location decisions of Moroccan outward foreign direct investment (FDI) using panel data on 54 host countries from 2007 to 2021 and the robust weighted least squares estimation method. The results show that the higher the share...

The aim of this work is to provide new evidence on the factors that determine the flow of FDI among transition countries. The analysis takes into consideration the period of most intense transition and post-transition (1994-2002) of 26 former socialist countries. The empirical estimates enable...

offered significant incentives in order to attract foreign direct investments (FDI), being motivated to do so by expectations of possible spillover benefits. Using an unbalanced panel of firm level data in Bulgaria, Poland and Romania over the 1995-2003 period, we examine the impact of foreign...

The study investigates the impact of cross-border mergers and acquisitions on GDP per capita and domestic investment in 22 European transition countries from 2000 to 2014 by using the system Generalized Method of Moments estimator. The main implications are that cross-border mergers and...

We use rich firm-level data and national input-output tables from 17 countries over the 2002-2005 period to test new and existing hypotheses about the impact of foreign direct investment (FDI) on the efficiency of domestic firms in the host country (i.e., spillovers). We document that backward...