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Horizontally-integrated MNE and plant heterogeneity

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Abstract

In the paper we develop a monopolistically competitive general equilibrium model of horizontally-integrated multinational enterprise (MNE) with heterogeneous plants. We demonstrate that smaller productivity differences between domestic and foreign plants increase the level of multinational activity. We also show that the level of multinational activity is the most intensive between countries of the similar size. Finally, we show that the relative wage increases (decreases) with relative productivity of workers and the degree of product differentiation when the home country is smaller (bigger) compared to the foreign country.

Suggested Citation

  • Andrzej Cieślik, 2013. "Horizontally-integrated MNE and plant heterogeneity," Bank i Kredyt, Narodowy Bank Polski, vol. 44(6), pages 605-622.
  • Handle: RePEc:nbp:nbpbik:v:44:y:2013:i:6:p:605-622
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    References listed on IDEAS

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    Cited by:

    1. repec:krk:eberjl:v:5:y:2017:i:1:p:151-167 is not listed on IDEAS
    2. Andrzej Cieslik, 2016. "Exports Versus Fdi In Smith-Motta Framework," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 11(2), pages 189-218, June.

    More about this item

    Keywords

    horizontal integration; MNE; plant heterogeneity;

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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