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Incomplete contracts And Vertically Integrated Multinational Enterprises

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  • Tang Linghui

Abstract

This paper conducts an empirical analysis of intra-firm trade for vertically integrated multinational enterprises (VMNEs). Within the context of incomplete contracts, the study attempts to explain cross-industry variations in the relative importance of intra firm trade. Using data for U.S. based multinationals from 1989 to 1996, it is found that the shares of U.S. intra-firm exports and imports are positively related to the non contractible a activities of U.S. intra-firm while they are negatively related to the non contractible activities of foreign affiliates. [F23, f10, L22]

Suggested Citation

  • Tang Linghui, 2002. "Incomplete contracts And Vertically Integrated Multinational Enterprises," International Economic Journal, Taylor & Francis Journals, vol. 16(1), pages 127-138.
    • Handle: RePEc:taf:intecj:v:16:y:2002:i:1:p:127-138
    DOI: 10.1080/10168730200000007
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    References listed on IDEAS

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    1. Wilfred J. Ethier & James R. Markusen, 2021. "Multinational firms, technology diffusion and trade," World Scientific Book Chapters, in: BROADENING TRADE THEORY Incorporating Market Realities into Traditional Models, chapter 7, pages 131-158, World Scientific Publishing Co. Pte. Ltd..
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