IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

International Investment Agreements and FDI Heterogeneity: Industry Evidence from Japanese Multinational Companies

Listed author(s):
  • Marie-Ann Betschinger
Registered author(s):

    This paper analyzes the impact of international trade and investment agreements on foreign direct investment (FDI) activities of Japanese multinationals in developing and emerging economies. Based on transaction cost economics and institutional theory it contributes to the existing empirical literature by distinguishing treaty impact by the size and the asset specificity of the FDI activities. FDI activities are measured as the foreign affiliate employment of Japanese multinational companies aggregated on the industry and host country level. The importance of sunk costs, captured through the size of the affiliates included in the FDI aggregation, for explaining bilateral investment treaty (BIT) effectiveness is shown, but a significant role of the industry averaged R&D intensity of the parent firms, as the measure for asset specificity, for BIT effectiveness is not identified. In the case of preferential trade and investment agreements (PTIAs) concluded by other countries, not involving Japan, a different set of mechanisms is uncovered: smaller sized Japanese affiliates seem to be the ones that gain substantially more from the agreements than the large ones. Also, a link between asset specificity and PTIA effectiveness is established.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    Download Restriction: no

    Paper provided by Institute of Economic Research, Hitotsubashi University in its series Global COE Hi-Stat Discussion Paper Series with number gd08-012.

    in new window

    Date of creation: Nov 2008
    Handle: RePEc:hst:ghsdps:gd08-012
    Contact details of provider: Postal:
    2-1 Naka, Kunitachi City, Tokyo 186

    Phone: +81-42-580-8327
    Fax: +81-42-580-8333
    Web page:

    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:hst:ghsdps:gd08-012. 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: (Tatsuji Makino)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.