Emerging Multinationals : Trends, Patterns and Determinants of Outward Investment by Indian Enterprises
AbstractThis paper has analyzed the trends, patterns and determinants of outward Investments by Indian enterprises that have increased notably since the onset of reforms. It finds that the sharp rise in outward investments since 1991 has been accompanied by a shift in geographical and sectoral focus of Indian investments. It develops an analytical framework for explaining the probability of an Indian enterprise investing abroad in an exclusive large dataset of Indian enterprises. The findings suggest that Indian enterprises draw their ownership advantages from their accumulated production experience, cost effectiveness of their production processes and other adaptations to imported technologies made with their technological effort, and some times with their ability to differentiate product. Firm size exerts a positive but a non-linear effect. Enterprises that are already in export markets are more likely to be outward investors. Finally, policy liberalization of 1990s turns out to have pushed Indian enterprises abroad.
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Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Microeconomics Working Papers with number 22108.
Date of creation: Jan 2006
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Investments; Indian enterprises; policy liberalization;
Find related papers by JEL classification:
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- D20 - Microeconomics - - Production and Organizations - - - General
- D92 - Microeconomics - - Intertemporal Choice - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
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