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The institutional determinants of agglomeration: a study in the global semiconductor industry

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Author Info

  • Xavier Martin
  • Robert M. Salomon
  • Zheying Wu

Abstract

We hypothesize that several characteristics of a country's institutional environment encourage firms to agglomerate. To test our hypotheses, we examine the collocation pattern of 931 plant investments made by 266 firms across 29 countries in the global semiconductor industry from 1975 to 2004. The results show that the decision to agglomerate is strongly dependent on a country's institutional context. Specifically, firms prefer to agglomerate when investing within countries with collectivist cultures, and those characterized by political and economic uncertainty. We assess the robustness of the results across multiple indicators of these institutional conditions. Copyright 2010 The Author 2010. Published by Oxford University Press on behalf of Associazione ICC. All rights reserved., Oxford University Press.

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File URL: http://hdl.handle.net/10.1093/icc/dtq049
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Bibliographic Info

Article provided by Oxford University Press in its journal Industrial and Corporate Change.

Volume (Year): 19 (2010)
Issue (Month): 6 (December)
Pages: 1769-1800

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Handle: RePEc:oup:indcch:v:19:y:2010:i:6:p:1769-1800

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Cited by:
  1. Martin, Xavier & Oever, K. van den, 2013. "Progress, maturity or exhaustion? Sources and modes of theorizing on the international strategy - performance relationship (1990-2011)," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5906160, Tilburg University.
  2. Martin, Xavier, 2013. "Solving theoretical and empirical conundrums in international strategy research by matching foreign entry mode choices and performance," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5637252, Tilburg University.

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