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Location Decision of Korean Manufacturing FDI: A Comparison between Korean Chaebols and Non-Chaebols

Author

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  • Young-Ryeol Park
  • Jeoung Yul Lee
  • Sunghoon Hong

Abstract

This study analysed the location selection determinants of Korean foreign direct investment (KFDI) from the perspectives of OLI paradigm and resource- and knowledge-based views. The study involved a sample of 1911 Korean multinational enterprises (MNEs) and their 3095 foreign subsidiaries during the period of 1999-2004. Specifically, the study compared the differences of foreign direct investment (FDI) location decisions (1) between less-developed and developed countries (LDCs and DCs) and (2) between chaebols and non-chaebols. The results showed that the partitioned sample model of chaebols versus non-chaebols was found to have more detailed effects on the location decision between the two regions than the combined full sample model. In addition, the results showed that there are clear, effectual differences for subsidiary scale and prior host country experience between chaebols and non-chaebols.

Suggested Citation

  • Young-Ryeol Park & Jeoung Yul Lee & Sunghoon Hong, 2011. "Location Decision of Korean Manufacturing FDI: A Comparison between Korean Chaebols and Non-Chaebols," Global Economic Review, Taylor & Francis Journals, vol. 40(1), pages 123-138.
    • Handle: RePEc:taf:glecrv:v:40:y:2011:i:1:p:123-138
    DOI: 10.1080/1226508X.2011.559332
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    Cited by:

    1. Jingoo Kang & Jeoung Yul Lee & Pervez N. Ghauri, 2017. "The Interplay of Mahalanobis Distance and Firm Capabilities on MNC Subsidiary Exits from Host Countries," Management International Review, Springer, vol. 57(3), pages 379-409, June.

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