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Exports and FDI motivations: Empirical evidence from U.S. foreign subsidiaries

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  • Franco, Chiara
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    Abstract

    Foreign direct investments (FDI) are supposed to bring into the host countries indirect benefits, usually referred as productivity spillover effects. However, an emerging literature analyses the effect with regard to the export performance of local firms finding inconclusive results. This literature is affected by two main shortcomings: firstly, the role played by FDI motivations is largely disregarded and, secondly, it is difficult to generalise results valid across countries. For these reasons, the aim of the paper is that of testing the effects of U.S. FDI on export intensity at the sectoral level in 16 OECD countries over the period 1990–2001 by bringing together international economics and international business perspective on FDI motivations. Through our data, we disentangle asset seeking and asset exploiting FDI motivations distinguishing also the channels through which the effect is going to occur. The findings show that asset exploiting motivations, and in particular market seeking FDI, are those that affect export intensity to a greater extent.

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    Bibliographic Info

    Article provided by Elsevier in its journal International Business Review.

    Volume (Year): 22 (2013)
    Issue (Month): 1 ()
    Pages: 47-62

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    Handle: RePEc:eee:iburev:v:22:y:2013:i:1:p:47-62

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    Related research

    Keywords: Exports; FDI motivations; Multinational enterprises; Spillover;

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    Cited by:
    1. Denicolai, Stefano & Zucchella, Antonella & Strange, Roger, 2014. "Knowledge assets and firm international performance," International Business Review, Elsevier, vol. 23(1), pages 55-62.
    2. Jaanika Meriküll & Tairi Rõõm, . "Are foreign-owned firms different ? Comparision of employment volatility and elasticity of labour demand," Bank of Estonia Working Papers wp2014-1, Bank of Estonia.
    3. Yang, Yong & Mallick, Sushanta, 2014. "Explaining cross-country differences in exporting performance: The role of country-level macroeconomic environment," International Business Review, Elsevier, vol. 23(1), pages 246-259.

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