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U.S. Greenfield Investments and M&A location: impact of American continental integration and Insider vs. Outsider position


  • Bertrand, Olivier

    (University of Paris 1)

  • Nicole Madariaga


This study examines the effects of economic integration on Greenfield Investments and cross-border Acquisitions locations. We use panel data on U.S. FDI in NAFTA and MERCOSUR members from 1989 to 1998. Economic integration is captured through tariff barriers and dummy variables. We pool data to distinguish between both agreements. We control for traditional macroeconomic determinants. It is found that economic integration certainly played a major role on U.S. firmsÕ location patterns. The U.S. position regarding the two agreements Ð insider vs. outsider- seemed to matter. Moreover, both our empirical study and our theoretical model underline the relevance of separating entry modes.

Suggested Citation

  • Bertrand, Olivier & Nicole Madariaga, 2003. "U.S. Greenfield Investments and M&A location: impact of American continental integration and Insider vs. Outsider position," Royal Economic Society Annual Conference 2003 22, Royal Economic Society.
  • Handle: RePEc:ecj:ac2003:22

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    FDI; integration; location; mode of entry;

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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