Productivity Distributions In International Oligopolies: Spillovers, Technology Transfer, And Heterogeneous FDI
- Topics:
- Foreign Direct Investment
- Tags:
- Currency & Foreign Exchange,
- Finance,
- Foreign Direct Investment,
- Foreign Direct Investment (FDI),
- Investment,
- University Of Nottingham
- Source:
- University of Nottingham
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Overview: Foreign-owned firms exhibit widely-documented productivity advantages over domestic firms. To interpret this stylized fact, we model the relationships between FDI flows and national productivity distributions across firms in an international oligopoly. Industrial structure is determined endogenously, and both greenfield- and acquisition-FDI are allowed for. The technology gap between firms interacts with localized spillovers to determine greenfield-FDI (Foreign Direct Investment) incentives and with within-firm technology transfer to determine the profitability of acquisition-FDI. Greenfield- and acquisition-FDI also affect the profitability of entry into the industry differently. We contrast our results with the insights of Dunning's well-known OLI framework on the causes of FDI flows.
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Format: PDF | Size: 425KB | Date: Feb 2006 | Pages: 26





