This paper studies the impact of innovation on the organizational structure. The theoretical framework predicts that a larger parental pool of knowledge raises the probability of offshoring. This holds in a national as well as an international context. However, when the producer loses territorial protection, the changeover from non-integration to integration is delayed. Employing data on German...

This paper analyses the optimality of policy specifications used to regulate the acquisition and operation of local firms by multinational enterprises. We emphasise the consequence of such regulations on the price of the domestic firm in the market for corporate control. We show that it is optimal to impose ceilings on foreign ownership of domestic firms when the government’s objective is to ma...

Foreign-invested enterprises (FIEs) are now an important component of the Chinese economy. Since 1992, the growth of FIEs has been exponential. However our understanding of the institutional factors driving the FIE growth remains limited. This paper uses data from 39 industries in China for a period of three years (1995-1997) to explore the institutional foundation of the FIE growth. Our findin...

We explore the relation between international financial integration and the level of entrepreneurial activity in a country. Using a unique firm level data set of approximately 24 million firms in nearly 100 countries in 2004 and 1999, we find suggestive evidence that international financial integration has been associated with higher levels of entrepreneurial activity. Our results are robust to...

Empirical studies at a firmor sector-level suggest that Foreign Direct Investment (FDI) increase wage dispersion by positively impact high skill wages. We contribute to the literature by examining the issue of FDI and wages on a large matched Swedish employer-employee data-set. Results suggest that foreign owned multinational firms (MNCs) tend to pay relatively high-skill wages, especially in c...

We explore the relation between international financial integration and the level of entrepreneurial activity in a country. Using a unique data set of approximately 24 million firms in nearly 100 countries in 1999 and 2004, we find suggestive evidence that international financial integration has been associated with higher levels of entrepreneurial activity. Our results are robust to using vari...

This paper studies the impact of cross-border Mergers and Acquisitions (M&As) on Carbon Dioxide emissions. Carbon Dioxide is the main anthropogenic greenhouse gas. A global problem that requires a multilateral solution. To take this into account we introduce an institutional variable, which captures the degree of international commitment to decrease and control the degradation of the environmen...

The use of foreign direct investment as a channel of international spillovers is by now fairly established in the empirical literature on innovation and growth. It is often argued that subsidiaries of foreign multinational enterprises are a mechanism through which technological know-how flows across borders. For foreign subsidiaries to be channels of international spillovers, these subsidiaries...

This paper analyzes to which extent foreign plant ownership involves lower tax payments than domestic plant ownership. We employ a model of endogenous foreign subsidiary ownership to derive a set of empirically testable hypotheses about the differential taxation of foreignand domestically-owned subsidiaries. We assess these hypotheses in a dataset of 33,577 European foreignand domestically-owne...

We argue that decentralization is particularly beneficial to firm performance in “bad times”. We present a model where bad times increase the importance of rapid action, and improve the alignment of incentives of managers within firms. We test this idea exploiting the 2008-2009 Great Recession using firm-level cross country panel data combined with our survey data on firm organization. We find ...