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How Different is Eastern Europe? Structure and determinants of location choices by French firms in Eastern and Western Europe

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  • Anne-Célia Disdier

    (TEAM Théories et Applications en Microéconomie et Macroéconomie - Maison des Sciences Economiques 106 Bvd de l'hôpital 75647 PARIS CEDEX 13 FR, Centre National de la Recherche Scientifique
    ECO-PUB Economie Publique - F-78850 Thiverval-Grignon FR, Institut National de la Recherche Agronomique)

  • Thierry Mayer

    ()
    (TEAM Théories et Applications en Microéconomie et Macroéconomie - Maison des Sciences Economiques 106 Bvd de l'hôpital 75647 PARIS CEDEX 13 FR, Centre National de la Recherche Scientifique)

Abstract

n this paper, we investigate the determinants of location choices of French multinational firms in Eastern and Western Europe. Our sample includes 1843 location choices in 19 countries from 1980 to 1999. We find important differences between the two regions of Europe regarding these determinants. Agglomeration effects are less strong in Central and Eastern European countries (CEECs) than in European Union (EU) countries. Location decisions are influenced significantly and positively by the institutional quality of the host country. We also investigate whether investors consider Western Europe and Eastern Europe as two distinct groups of potential host countries. We confirm the relevance of an East-West structure in the country location decision and show that this relevance decreases as the transition process advances, in CEE countries. Journal of Comparative Economics 32 (2) (2004) 280-296.

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Bibliographic Info

Paper provided by Institut National de la Recherche Agronomique, France in its series Working Papers with number 245489.

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Length: 280-296
Date of creation: 2004
Date of revision:
Publication status: Published in Journal of Comparative Economics
Handle: RePEc:inr:wpaper:245489

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Keywords: Foreign direct investment; Location choice; Conditional logit; Nested logit; European Union; Eastern Europe;

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