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Multinational Firms, Technology and Location

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  • Norbäck, Pehr-Johan

    ()
    (The Research Institute of Industrial Economics)

Abstract

This paper analyzes a three-stage optimization problem in which a firm chooses (i) its technology, by deciding on a level of R&D, (ii) whether this technology is to be used in a domestic or in a foreign plant and (iii) the quantity produced and sold on the market. If technology transfer costs are low, "high-tech" or R&D-intensive firms tend to produce abroad. At higher technology transfer costs, high-tech firms tend to export. An empirical analysis using a data set of Swedish multinational firms, confirms the latter prediction.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 512.

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Length: 35 pages
Date of creation: 12 Mar 1999
Date of revision: 02 Nov 2000
Publication status: Forthcoming in Journal of International Economics.
Handle: RePEc:hhs:iuiwop:0512

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Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden
Phone: +46 8 665 4500
Fax: +46 8 665 4599
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Web page: http://www.ifn.se/
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Keywords: Multinational Firms; R&D; Location; Empirical Analyses;

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  16. S. Lael Brainard, 1993. "A Simple Theory of Multinational Corporations and Trade with a Trade-Off Between Proximity and Concentration," NBER Working Papers 4269, National Bureau of Economic Research, Inc.
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