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Vertical Production Networks: Evidence from France

Author

Listed:
  • Michel Fouquin
  • Laurence Nayman
  • Laurent Wagner

Abstract

This paper investigates the determinants of intra-firm trade of multinational firms located in France, using data on French companies. Results on the vertical pattern of production networks differ according to the affiliates? location. Lower wage and transportation costs in the developing countries increase, as expected, the vertical segmentation of production. In the developed countries, lower trade and unit wage costs, and hence, a strong and positive labour productivity matter a lot in explaining French MNCs? preferences. Among the other variables of interest, partnership and market potential have been given special attention. The results substantiate a mix of vertical and horizontal FDI, mainly when we separate out capital intensive from labour intensive intermediate products.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Michel Fouquin & Laurence Nayman & Laurent Wagner, 2006. "Vertical Production Networks: Evidence from France," Working Papers 2006-18, CEPII research center.
    • Handle: RePEc:cii:cepidt:2006-18
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    File URL: http://www.cepii.fr/PDF_PUB/wp/2006/wp2006-18.pdf
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    Citations

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    Cited by:

    1. Wissner, Matthias, 2011. "ICT, growth and productivity in the German energy sector - On the way to a smart grid?," Utilities Policy, Elsevier, vol. 19(1), pages 14-19, January.
    2. Nune Hovhannisyan, 2019. "Technology Gap and International Knowledge Transfer: New Evidence from the Operations of Multinational Corporations," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 45(4), pages 612-638, October.
    3. Jérôme Sgard, 2006. "On Legal Origins and Brankruptcy Laws: the European Experience (1808-1914)," Sciences Po publications 2006-26, Sciences Po.
    4. repec:spo:wpecon:info:hdl:2441/8221 is not listed on IDEAS
    5. repec:hal:wpspec:info:hdl:2441/8221 is not listed on IDEAS
    6. Jérôme Sgard, 2006. "On Legal Origins and Brankruptcy Laws: the European Experience (1808-1914)," Working Papers hal-01065660, HAL.
    7. Jérôme Sgard, 2006. "On Legal Origins and Brankruptcy Laws: the European Experience (1808-1914)," SciencePo Working papers Main hal-01065660, HAL.
    8. Véronique Salins & Agnès Bénassy-Quéré, 2006. "Institutions and Bilateral Asset Holdings," Working Papers 2006-19, CEPII research center.
    9. repec:hal:spmain:info:hdl:2441/8221 is not listed on IDEAS

    More about this item

    Keywords

    International firms; Globalization; Intra-industry trade; segmentation; Productivity; International comparison; FDI; Factor costs;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F10 - International Economics - - Trade - - - General
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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