We extend the Behrens et al. (2009) general equilibrium heterogeneous firms framework by horizontal foreign direct investment. The model features endogenously determined firm entrants, wages, productivity cutoffs, flexible price markups and allows for wage differentials across countries in...

This paper analyzes the off-shoring strategy from an empirical view. It focuses on a set of models, extracts a set of testable hypothesizes and creates a suitable set of variable to test their validity. This analysis is based on a data set from French manufacturing firms that provides detailed...

Corruption has a negative impact on foreign direct investment (FDI). However, transition economies show high levels of corruption and also high levels of FDI. I argue that it is not the level but rather the type of corruption that affects FDI in transition economies. Pervasive corruption, or...

This working paper was written by Ana Fernandes (University of Sussex) and Heiwai Tang (Tufts University and Centro Studi Luca d'Agliano).This paper uses detailed product-level export data for China and proposes an extension of the Antràs and Helpman (2004) framework that includes investments...

This paper analyzes the optimality of policy specifications used to regulate the acquisition and operation of local firms by multinational enterprises (MNE). We emphasize the consequence of such regulation on the price of the domestic firm in the market for corporate control. We show that it is...

The article draws on the concepts of cultural and political embeddedness to analyse the local embeddedness of a global transnational engineering firm in transforming economies. It compares the process of the negotiations for and the acquisitions of assets undertaken by ABB in Wroclaw, Poland and...

Purpose – The purpose of this paper is to investigate important impediments to knowledge creation within newly-established foreign invested R&D centers in China and India. Design/methodology/approach – The paper presents a framework based on knowledge creation theory in order to understand...

The choice of the location of foreign direct investment is a complex phenomenon, depending not only on host‐country characteristics, but also on host‐industry and specific source‐firm characteristics. To capture these different influences for foreign investment location decisions into 13...

This paper analyzes the demand for labor by home multinational enterprises (MNEs) in Europe. To this end we use a unique firm level panel data set of more than 1,200 European multinational enterprises and their subsidiaries that are located in either the European Union, Central and Eastern...

The overwhelming importance of multinational activities as well as the coexistence of exporters and multinationals within the developed countries demand for theoretical models which provide a convincing explanation of simultaneous two-way trade and horizontal multinational activities. We present...