Advanced Search
MyIDEAS: Login to save this paper or follow this series

Home Country Effects of Investing Abroad: Evidence from Quantile Regressions

Contents:

Author Info

  • Anna Maria Falzoni

    (CESPRI, Università Bocconi, Milano and University of Bergamo, Italy)

  • Mara Grasseni

    (University of Bergamo, Italy)

Abstract

Home country effects of domestic firms investing abroad have been a highly debated issue. Overall, the results of a number of empirical studies seem not to support the fear that MNEs are exporting domestic production and/or jobs; however the issue should be examined more deeply. In particular, following the recent theoretical and empirical literature on firm heterogeneity, an important point that should be investigated is whether the impact of outward FDI on the performance of parent firms might differ according to their level of productivity or their size. Using quantile regressions and a data set for Italian firms investing abroad, this paper shows that the impact of international expansion on parents’ performance (measured in terms of total factor productivity, labour productivity and employment) varies across firms in different quantiles of the performance distribution and across foreign affiliates’ geographical locations. In particular, quantile regressions seem to show that firms throughout the productivity distribution do not benefit from FDI in Less Developed Countries. Differently, parent firms in the upper quantiles of productivity seem to be positively affected by foreign expansion in Developed Countries. As for employment, only small firms seem to be negatively influenced by outward FDI. Finally, measures of multinational experience influence positively and significantly parent firms across quantiles of productivity and employment.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: ftp://ftp.unibocconi.it/pub/RePEc/cri/papers/WP170FalzoniGrasseni.pdf
Download Restriction: no

Bibliographic Info

Paper provided by KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy in its series KITeS Working Papers with number 170.

as in new window
Length: 38 pages
Date of creation: Jun 2005
Date of revision: Jun 2005
Handle: RePEc:cri:cespri:wp170

Contact details of provider:
Postal: via Sarfatti, 25 - 20136 Milano - Italy
Phone: +39.025836.3397
Fax: +39.025836.3399
Web page: http://www.kites.unibocconi.it/

Order Information:
Postal: E G E A - via R. Sarfatti, 25 - 20136 Milano -Italy

Related research

Keywords: Multinational Firms; Productivity; Employment; Quantile Regression;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Sourafel Girma, & Holger Görg, 2003. "Foreign direct investmant, spillovers and absorptive capacity: Evidence from quantile regressions," The Institute for International Integration Studies Discussion Paper Series iiisdp01, IIIS.
  2. Wolfgang Keller & Stephen R. Yeaple, 2009. "Multinational Enterprises, International Trade, and Productivity Growth: Firm-Level Evidence from the United States," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 821-831, November.
  3. Giorgio Barba Navaretti & Davide Castellani, 2003. "Investments Abroad and Performance at Home Evidence from Italian Multinationals," Development Working Papers 180, Centro Studi Luca d\'Agliano, University of Milano.
  4. Robert E. Lipsey, 1999. "Foreign Production by U.S. Firms and Parent Firm Employment," NBER Working Papers 7357, National Bureau of Economic Research, Inc.
  5. Hartmut Egger & Peter Egger, 2006. "International Outsourcing and the Productivity of Low-Skilled Labor in the EU," Economic Inquiry, Western Economic Association International, vol. 44(1), pages 98-108, January.
  6. Markusen, James R & Maskus, Keith E, 2002. "Discriminating among Alternative Theories of the Multinational Enterprise," Review of International Economics, Wiley Blackwell, vol. 10(4), pages 694-707, November.
  7. Head, Keith & Ries, John, 2003. "Heterogeneity and the FDI versus export decision of Japanese manufacturers," Journal of the Japanese and International Economies, Elsevier, vol. 17(4), pages 448-467, December.
  8. Henrik Braconier & Karolina Ekholm & Karen Knarvik, 2001. "In search of FDI-transmitted R&D spillovers: A study based on Swedish data," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 137(4), pages 644-665, December.
  9. Bruno Van Pottelsberghe & Frank Lichtenberg, 2001. "Does foreign direct investment transfer technology across borders?," ULB Institutional Repository 2013/6221, ULB -- Universite Libre de Bruxelles.
  10. Mata, Jose & Machado, Jose A. F., 1996. "Firm start-up size: A conditional quantile approach," European Economic Review, Elsevier, vol. 40(6), pages 1305-1323, June.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Martin Falk & Yvonne Wolfmayr, 2008. "The Impact of Outward FDI in Central and Eastern Europe on Employment in the EU-15 Countries," FIW Research Reports series I-016, FIW.
  2. Joachim Wagner, 2011. "From Estimation Results to Stylized Facts Twelve Recommendations for Empirical Research in International Activities of Heterogeneous Firms," De Economist, Springer, vol. 159(4), pages 389-412, December.
  3. Martin Falk & Yvonne Wolfmayr, 2010. "The substitutability between parent company and foreign affiliate employment in Europe," Empirica, Springer, vol. 37(1), pages 87-100, February.
  4. Kokko, Ari, 2006. "The Home Country Effects Of Fdi In Developed Economies," EIJS Working Paper Series 225, The European Institute of Japanese Studies.
  5. David Powell & Joachim Wagner, 2010. "The Exporter Productivity Premium along the Productivity Distribution: First Evidence from a Quantile Regression Approach for Fixed Effects Panel Data Models," Working Paper Series in Economics 182, University of Lüneburg, Institute of Economics.
  6. Maria Rosaria Ferrante & Marzia Freo, 2012. "The Total Factor Productivity Gap between Internationalised and Domestic Firms: Net Premium or Heterogeneity Effect?," The World Economy, Wiley Blackwell, vol. 35(9), pages 1186-1214, 09.
  7. Cesare Imbriani & Rosanna Pittiglio & Filippo Reganati, 2011. "Outward Foreign Direct Investment and Domestic Performance: the Italian Manufacturing and Services Sectors," Atlantic Economic Journal, International Atlantic Economic Society, vol. 39(4), pages 369-381, December.
  8. David Powell & Joachim Wagner, 2011. "The Exporter Productivity Premium along the Productivity Distribution: Evidence from Unconditional Quantile Regression with Firm Fixed Effects," Working Papers 837, RAND Corporation Publications Department.
  9. Tomaso Pompili & Michela Martinoia, 2011. "Building Synthetic Indicators For Aspects Of Territorial Capital Towards Their Impact On Regional Performance," ERSA conference papers ersa11p1528, European Regional Science Association.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:cri:cespri:wp170. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Valerio Sterzi).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.