The Relative Importance Of Horizontal Versus Vertical FDI
- Topics:
- Foreign Direct Investment
- Tags:
- Currency & Foreign Exchange,
- Finance,
- Foreign Direct Investment,
- Foreign Direct Investment (FDI),
- Investment,
- University Of Hawaii
- Source:
- University of Hawaii
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Overview: A dramatic rise in Foreign Direct Investment (FDI) in recent decades has been an important aspect of globalization. The literature in trade theory has incorporated multinational firms in a general equilibrium framework of trade to analyze country characteristics as determinants of multinational activity. Developments in the theoretical literature have lead to a burgeoning empirical work to examine relative importance of alternative FDI theories. Our objective in this paper is to add more evidence for the increasing importance of vertical FDI in the recent periods, thereby providing supportive evidence for the KC (Knowledge Capital) model over the HOR model. While recent vertical FDI studies focus on factor costs effects on various types of FDI as evidence for vertical motives.
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Format: PDF | Size: 294KB | Date: Oct 2006 | Pages: 64






