The determinants of geographic configuration of value chain activities: Foreign multinational enterprises in Japanese manufacturing
AbstractThis paper attempts to identify the determinants of the multinational enterpriseâ€™s decision to locate value chain activities, such as R&D, procurement, production, and distribution, among the source and the host countries. Using data of foreign firms in Japanese manufacturing, the statistical analysis found that the determinants of direct investment in one business activity are not necessarily the same as the determinants for another activity, while they are linked each other through complex mechanisms. For example, foreign subsidiaries in R&D intensive industries in Japan are more likely to import intermediate goods, use contractors for production, and distribute through fragmented distribution system. It appears that the traditional transaction-cost model is less consistent with the pattern of investments in R&D, productions, and distribution at least for the sample used in this paper. Copyright Springer-Verlag Berlin Heidelberg 2004
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Bibliographic InfoArticle provided by Springer in its journal International Economics and Economic Policy.
Volume (Year): 1 (2004)
Issue (Month): 2 (January)
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Web page: http://www.springerlink.com/link.asp?id=111059
vertical foreign direct investment; R&D; manufacturing; distribution; F21; F23; L22;
Find related papers by JEL classification:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
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- Canfei He & Xiaojun Xiao, 2011. "Geography of Multinational Corporations and Functional Specialization in Chinese Cities," Symphonya. Emerging Issues in Management, University of Milano-Bicocca, issue 1 Global .
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