Market Size and the Survival of Foreign-owned Firms
AbstractWe develop a general equilibrium model with heterogeneous firms and Foreign Direct Investment (FDI) cost uncertainty and investigate the survival of foreign-owned firms. The survival probabilities of foreign-owned firms depend on firm-level characteristics such as productivity and host country characteristics such as market size. We show that a foreign-owned firm will be less likely to be shut down when its parent firm’s productivity is higher and its indigenous competitors are less productive. Whilst a larger market size will always reduce the survival probability of indigenous firms, it can lead to a higher survival probability for foreign-owned firms if their parent firms are sufficiently productive.
Download InfoIf 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.
Bibliographic InfoPaper provided by University of Nottingham, GEP in its series Discussion Papers with number 07/25.
Date of creation:
Date of revision:
Contact details of provider:
Postal: School of Economics University of Nottingham University Park Nottingham NG7 2RD
Phone: (44) 0115 951 5620
Fax: (0115) 951 4159
Web page: http://www.nottingham.ac.uk/gep/index.aspx
More information through EDIRC
FDI; heterogeneous firms; market size;
Other versions of this item:
- Rod Falvey & David Greenaway & Zhihong Yu, 2007. "Market Size and the Survival of Foreign-owned Firms," The Economic Record, The Economic Society of Australia, vol. 83(s1), pages S23-S34, 09.
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral 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: (Hilary Hughes).
If references are entirely missing, you can add them using this form.