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Multinational investments across Europe: a multilevel analysis

Author

Listed:
  • Jonas Kleineick
  • Andrea Ascani

    (Gran Sasso Science Institute)

  • Martijn Smit

    (Utrecht University)

Abstract

This research focuses on the investigation of the location determinants of multinational corporations’ investments in EU countries. Investment projects are addressed by making a distinction between greenfield investments and M&A projects. Besides traditional factors (such as market characteristics) the effect of innovation capabilities and the institutional environment are incorporated in the analysis. The use of a multilevel model makes it possible to empirically assess the effect of national and regional characteristics on the location decision of multinationals. The results suggest that greenfield investments and M&A are similar in their location determinants, although the former have a stronger correlation with highly educated populations. Urbanisation, associated with land cost, as well as national (rather than regional) markets are insignificant. Finally, we find no evidence for the importance of political stability within Europe.

Suggested Citation

  • Jonas Kleineick & Andrea Ascani & Martijn Smit, 2020. "Multinational investments across Europe: a multilevel analysis," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 40(1), pages 67-105, April.
    • Handle: RePEc:spr:jahrfr:v:40:y:2020:i:1:d:10.1007_s10037-020-00139-2
    DOI: 10.1007/s10037-020-00139-2
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    More about this item

    Keywords

    Multinationals; Investment; Regions; European Union;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-

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