Powerful Multinational or Persecuted Foreigners: ‘Foreignness’ and Influence over Government
One of the enduring themes of the globalization debate is whether international law should be strengthened to protect foreign firm from discriminatory host governments, or rather strengthened to protect host governments from powerful multinational firms. This paper uses firm-level data from the World Business Environment Survey (WBES) to lend some empirical evidence to the debate. In doing so it contributes to academic understanding of what a `foreign firm' is, and challenges the notion that institutional superiority makes OECD governments less prone to anti-foreign bias. Although the terms `foreign firm' and `multinational subsidiary' are often used interchangeably, in the WBES data the managers of only about half of the firms with more than ten percent foreign ownership view themselves as part of a multinational. This distinction between multinational and non-multinational foreign firms was important in regression analysis of self-reported influence over government. In non- OECD countries - where we find no evidence of anti-foreign bias - multinationals appear significantly more influential than other firms. Meanwhile, in OECD countries, foreign non-multinationals do appear at a disadvantage in terms of influence relative to domestic firms, but this `liability of foreignness' does not appear to extend to foreign-multinational affiliates.
|Date of creation:||Apr 2010|
|Contact details of provider:|| Postal: +61 2 6125 3807|
Phone: +61 2 6125 3807
Fax: +61 2 6125 0744
Web page: http://rse.anu.edu.au/cepr.php
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kobrin, Stephen J., 1987. "Testing the bargaining hypothesis in the manufacturing sector in developing countries," International Organization, Cambridge University Press, vol. 41(04), pages 609-638, September.
- Facundo Albornoz & Matthew A. Cole & Robert J. R. Elliott & Marco G. Ercolani, 2009.
"In Search of Environmental Spillovers,"
The World Economy,
Wiley Blackwell, vol. 32(1), pages 136-163, 01.
- Facundo Albornoz & Matthew A Cole & Robert J R Elliott & Marco G Ercolani, 2008. "In Search of Environmental Spillovers," Discussion Papers 08-03, Department of Economics, University of Birmingham.
- Emma Aisbett & Larry Karp & Carol Mcausland, 2010. "Police Powers, Regulatory Takings and the Efficient Compensation of Domestic and Foreign Investors," The Economic Record, The Economic Society of Australia, vol. 86(274), pages 367-383, 09.
- Aisbett, Emma & Karp, Larry & McAusland, Carol, 2008. "Police-powers, regulatory takings and the efficient compensation of domestic and foreign investors," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt5x84h5kf, Department of Agricultural & Resource Economics, UC Berkeley.
- Heyman, Fredrik & Sjoholm, Fredrik & Tingvall, Patrik Gustavsson, 2007. "Is there really a foreign ownership wage premium? Evidence from matched employer-employee data," Journal of International Economics, Elsevier, vol. 73(2), pages 355-376, November.
- Heyman, Fredrik & Sjöholm, Fredrik & Gustavsson Tingvall, Patrik, 2004. "Is there Really a Foreign Ownership Wage Premium? Evidence from Matched Employer-Employee Data," Working Paper Series 199, Trade Union Institute for Economic Research.
- Heyman, Fredrik & Sjöholm, Fredrik & Gustavsson Tingvall, Patrik, 2004. "Is There Really A Foreign Ownership Wage Premium?Evidence From Matched Employer-Employee Data," EIJS Working Paper Series 206, The European Institute of Japanese Studies.
- Heyman, Fredrik & Sjöholm, Fredrik & Gustavsson Tingvall, Patrik, 2006. "Is There Really A Foreign Ownership Wage Premium? Evidence From Matched Employer-Employee Data," EIJS Working Paper Series 230, The European Institute of Japanese Studies.
- Heyman, Fredrik & Gustavsson Tingvall, Patrik & Sjöholm, Fredrik, 2006. "Is There Really a Foreign Ownership Wage Premium? Evidence from Matched Employer-Employee Data," Working Paper Series 674, Research Institute of Industrial Economics.
- James R. Markusen, 2004. "Multinational Firms and the Theory of International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262633078, July.
- Markusen, James R., 2002. "Multinational Firms and the Theory of International Trade," MPRA Paper 8380, University Library of Munich, Germany.
- Zaheer, Srilata, 2002. "The liability of foreignness, redux: a commentary," Journal of International Management, Elsevier, vol. 8(3), pages 351-358.
- Lee, Tan, 2004. "Determinants of the foreign equity share of international joint ventures," Journal of Economic Dynamics and Control, Elsevier, vol. 28(11), pages 2261-2275, October.
- Nauro Campos & Francesco Giovannoni, 2007. "Lobbying, corruption and political influence," Public Choice, Springer, vol. 131(1), pages 1-21, April.
- Campos, Nauro F & Giovannoni, Francesco, 2006. "Lobbying, Corruption and Political Influence," CEPR Discussion Papers 5886, C.E.P.R. Discussion Papers.
- Nauro F. Campos & Francesco Giovannoni, 2006. "Lobbying, Corruption and Political Influence," CEDI Discussion Paper Series 06-14, Centre for Economic Development and Institutions(CEDI), Brunel University.
- Campos, Nauro F & Giovannoni, Francesco, 2006. "Lobbying, Corruption and Political Influence," IZA Discussion Papers 2313, Institute for the Study of Labor (IZA).
- Dasgupta, Susmita & Hettige, Hemamala & Wheeler, David, 2000. "What Improves Environmental Compliance? Evidence from Mexican Industry," Journal of Environmental Economics and Management, Elsevier, vol. 39(1), pages 39-66, January.
- Benjamin Gomes-Casseres, 1990. "Firm Ownership Preferences and Host Government Restrictions: An Integrated Approach," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 21(1), pages 1-22, March.
- Nakamura, M. & Xie, J., 1998. "Nonverifiability, noncontractibility and ownership determination models in foreign direct investment, with an application to foreign operations in Japan," International Journal of Industrial Organization, Elsevier, vol. 16(5), pages 571-599, September.
- Markusen, James R, 2001. "Commitment to Rules on Investment: The Developing Countries' Stake," Review of International Economics, Wiley Blackwell, vol. 9(2), pages 287-302, May.
- Caves, Richard E, 1971. "International Corporations: The Industrial Economics of Foreign Investment," Economica, London School of Economics and Political Science, vol. 38(149), pages 1-27, February.
- M. Sornarajah, 2006. "A law for need or a law for greed?: Restoring the lost law in the international law of foreign investment," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 6(4), pages 329-357, December. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:auu:dpaper:638. See general 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: ()
If references are entirely missing, you can add them using this form.