Vertical foreign direct investment: Evidence from Japanese and U.S. multinational enterprises

Horizontal versus Vertical Foreign Direct Investment: Evidence from U.S. Multinationals

We use firm-level data from the Bureau of Economic Analysis to document a new set of facts on the motives for foreign direct investment. We document that a key difference between ‘’horizontal” and ‘’vertical” affiliates is their size: Intra-firm trade is concentrated among a small number of large affiliates, while the median affiliate, smaller in size, reports no shipments to the parent and dir...

Foreign Direct Investment and the Multinational Enterprise

Intra- and Inter-industry Linkages in Foreign Direct Investment: Evidence from Japanese Investment in Europe

This paper studies the location choices of Japanese manufacturing and service firms in Europe between 1970 and 1995. We examine whether the presence of Japanese manufacturing (service) firms attracts other Japanese manufacturers (service providers), whether there exist interindustry linkages between the two sectors, and how such intraand interindustry agglomeration effects have evolved over tim...

Foreign Direct Investment and Economic Growth: Evidence from Iran and GCC

Abstract F DI can create employment and reduce poverty, increase the host country’s export capacity causing the developing country to increase its foreign exchange earnings. The aim of this study is to investigate whether FDI affect economic growth in GCC countries over the period 1980-2014 using ARDL approaches. The empirical results show that the FDI is one of the major drivers of e...

Market expansion versus cost reduction: a financial analysis of foreign direct investment advantages for multinational enterprises

By testing a large sample of US-based multinational enterprises (MNEs), we attempt to microscope the relations between FDI advantages and excess market value created thereby. Two most commonly pursued FDI advantages—market expansion and cost reduction—come under the analysis. We find that the overseas divisions of US-based MNEs have significant market expansion advantage over the domestic divis...