We study the investment behavior of foreign investors in association with an equity market liberalization, and find a strong link between foreigners trading and local market returns. In the period following the liberalization, net purchases by foreign investors induced a permanent increase in stock prices, suggesting that local firms reduced their cost of equity capital. We also find a strong l...

【Keyword】China, investment promotion agency, firm-level data, sample selection 【Abstract】This paper tries to verify how the establishment of investment promotion agencies (IPAs) affects the decisions of foreign firms regarding their subsequent investment by combining firm-level data from the World Bank’s Enterprise Survey with city-level information on (IPAs) in China. After correcting for pote...

This paper examines a simple model of outsourcing involving matching frictions and home bias in firms’ acquisition of intermediate goods. Two groups of seller firms—local sellers and foreign sellers—may face different degrees of search frictions even though they are identical in terms of productivity. Two groups of buyer firms are considered: one group accepts local and foreign sellers equally,...

This study uses the segmented dual-class shares of Chinese firms---A shares traded inside mainland China by local investors and H shares traded in Hong Kong by foreign investors---to analyze how local and foreign investors react to public news about the same firms. We find significant heterogeneity in their reactions. First, foreign investors react more strongly to earnings announcements. Secon...

Using the corresponding industry return in the foreign countries, I show that the foreign operations information of multinational firms is slowly incorporated into stock prices. A trading strategy based on this effect generates an abnormal return of approximately 0.8% per month, or 9.6% per year, controlling for risk-based factors. The return predictability is not driven by U.S. industry moment...

This study combines the theories of international business and management with network theory in order to examines the networking activities of foreign affiliates. It focuses on a specific kind of network, which is taking place between firms based in geographic proximity. A comparative analysis between foreign and indigenous firms in selected professional service industries located in Central L...

This paper studies the effect of corporate taxes on investment. Using firm-level data on German corporations, we investigate the 2008 tax reform that cut corporate taxes by 10 percentage points. We expect heterogeneous investment responses across firms, since firms with a foreign parent have more cross-country profit shifting opportunities than domestically owned firms. Using a matching differe...

With the dramatic increase in direct foreign investment (DFI) in China over the past two decades, understanding the role of DFT in her economic development has become essential. This thesis focuses on the impact of the clustering of DFI on urban economic development through a case study of the Economic and Technological Development Zone (ETDZ) and High-tech Industrial Park (HTIP) in Qingdao, Sh...

This paper studies the effects of EU antidumping policy when foreign firms have the possibility to ’jump’ antidumping measures by engaging in foreign direct investment (FDI) in the EU. Using a multi-stage framework, we study the EU administration’s choice between an antidumping duty and a price-undertaking, taking into account the effect of these measures on the location decision of the foreign...

In this paper we investigated the hypothesis of export spillovers from foreign multinationals to domestic firms using a data set of UK manufacturing firms from 1992 to 1999. Unlike previous studies we allow not only for the possibility of horizontal (i.e. intraindustry) and regional externalities, but also for vertical ones (i.e. inter-industry: forward and backward). Deploying and Heckman sele...