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Transport Modal Choice by Multinational Firms: Firm-level Evidence from Southeast Asia

  • Kazunobu Hayakawa
  • Kiyoyasu Tanaka
  • Yasushi Ueki

We examine transport-mode decisions by multinational firms to shed light on the role of freight logistics in multinational activity. Using a firm-level survey in Southeast Asia, we show that foreign ownership has a significantly positive and quantitatively large impact on the likelihood that air/sea transportation is chosen relative to truck shipping. This result is robust to the shipping distance, cross-border freight, and transport infrastructure. Both foreign-owned exporters and importers also tend to use air/sea transportation. Thus, our analysis presents a new distinction between multinational and domestic firms in their decision over transport modes.

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File URL: http://hdl.handle.net/10.1080/10168737.2012.719920
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Article provided by Taylor & Francis Journals in its journal International Economic Journal.

Volume (Year): 27 (2013)
Issue (Month): 4 (December)
Pages: 609-623

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Handle: RePEc:taf:intecj:v:27:y:2013:i:4:p:609-623
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  1. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Boston College Working Papers in Economics 593, Boston College Department of Economics.
  2. Tomohiro MACHIKITA & Yasushi UEKI, 2010. "Innovation in Linked and Non-linked Firms: Effects of Variety of Linkages in East Asia," Working Papers DP-2010-03, Economic Research Institute for ASEAN and East Asia (ERIA).
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  5. Yeaple, Stephen & Helpman, Elhanan & Melitz, Marc, 2004. "Export versus FDI with Heterogeneous Firms," Scholarly Articles 3229098, Harvard University Department of Economics.
  6. Fosfuri, Andrea & Motta, Massimo, 1999. " Multinationals without Advantages," Scandinavian Journal of Economics, Wiley Blackwell, vol. 101(4), pages 617-30, December.
  7. Davide Castellani, 2002. "Export behavior and productivity growth: Evidence from Italian manufacturing firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(4), pages 605-628, December.
  8. Barba Navaretti, Giorgio & Castellani, Davide, 2004. "Investments Abroad and Performance at Home: Evidence from Italian Multinationals," CEPR Discussion Papers 4284, C.E.P.R. Discussion Papers.
  9. James R. Markusen, 2004. "Multinational Firms and the Theory of International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262633078, June.
  10. David L. Hummels & Georg Schaur, 2009. "Hedging Price Volatility Using Fast Transport," NBER Working Papers 15154, National Bureau of Economic Research, Inc.
  11. Michael P. Keane & Susan E. Feinberg, 2007. "ADVANCES IN LOGISTICS AND THE GROWTH OF INTRA-FIRM TRADE: THE CASE OF CANADIAN AFFILIATES OF U.S. MULTINATIONALS, 1984-1995 -super-* ," Journal of Industrial Economics, Wiley Blackwell, vol. 55(4), pages 571-632, December.
  12. Michael P. Keane & Susan E. Feinberg, 2006. "Accounting for the Growth of MNC-Based Trade Using a Structural Model of U.S. MNCs," American Economic Review, American Economic Association, vol. 96(5), pages 1515-1558, December.
  13. David Greenaway & Richard Kneller, 2007. "Firm heterogeneity, exporting and foreign direct investment," Economic Journal, Royal Economic Society, vol. 117(517), pages F134-F161, 02.
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