This paper presents a model of the interaction between two rival firms based in the same country. Each firm must decide how to serve a foreign market (export or foreign production) and how much to invest in a corporate-wide asset that reduces production costs and/or augments the...

We construct a model in which oligopolistic firms decide where to locate. Firms choose to locate either in a country where employment protection implies costly output adjustments or in one without adjustment costs. Using a two-period three-stage game with uncertainty it is demonstrated that...

The issue of economic governance is highly discussed pertaining to the question of industrialisation of a country, but the literature on trade and foreign direct investment (FDI) hardly pays attention to this aspect. We develop a simple model to show how good economic governance in the domestic...

This paper analyzes the role that the ownership structure of companies plays for governments in asymmetric countries´ competition for a multinational´s subsidiary. I argue that equilibrium tax policies as well as a foreign investor´s location decision in policy competition between these...

We provide a new explanation for a profitable horizontal merger between Cournot oligopolists with symmetric constant returns to scale technologies and homogeneous goods. We show that a merger can be profitable if it prevents a foreign firm from undertaking FDI. Our result is due to the effect of...

This study develops a two-country policy competition model for foreign direct investment between asymmetric countries. It analyzes how firm ownership via foreign capital affects the investment location choice of the foreign firm, and policy competition between the potential host countries. The...

This paper analyzes the effects of a potential spillover on technology transfer of a multinational enterprise and on the host country policy. In particular, we examine how both parties' incentives can be controlled through the ownership structure in an international joint venture. In contrast to...

This paper presents a simple model to analyse the impact of localised externalities on the internationalisation decision of firms. We argue that, once localised spillovers are taken into account, the standard predictions on the nature and direction of foreign direct investment (FDI) flows may...

This paper analyzes welfare implications of protecting intellectual property rights (IPR) in the framework of TRIPS for developing countries (South) through its impact on innovation, market structure and technology transfer. In a North-South trade environment, the South sets its IPR policy...

This paper presents a simple model of the interaction between two firms, based in different countries, each of which faces the export v MNE choice concerning the serving of each other’s home market. The basic game structure is similar to that elsewhere in the literature (Horstmann & Markusen...