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Tough Love: Do Czech Suppliers Learn from their Relationships with Multinationals?

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  • Beata S. Javorcik
  • Mariana Spatareanu

Abstract

Countries strive to attract foreign direct investment hoping that knowledge brought by multinationals will spill over to domestic producers. While the literature has cast doubt on the existence of spillovers within industries, it has found evidence of spillovers from multinationals to the supplying sectors. However, the existing studies rely on industry‐level proxies rather than information on actual relationships between suppliers and multinationals. This study goes one step further by employing a unique dataset from the Czech Republic where such relationships can be identified. It finds evidence consistent with both high productivity firms having a higher probability of supplying multinationals as well as suppliers learning from their relationships with multinationals.

Suggested Citation

  • Beata S. Javorcik & Mariana Spatareanu, 2009. "Tough Love: Do Czech Suppliers Learn from their Relationships with Multinationals?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 111(4), pages 811-833, December.
    • Handle: RePEc:bla:scandj:v:111:y:2009:i:4:p:811-833
    DOI: 10.1111/j.1467-9442.2009.01591.x
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    References listed on IDEAS

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