Export platform foreign direct investment : theory and evidence
This paper proposes a model that accounts for â€œexport platformâ€ FDI â€“ a form of FDI that is common in the data but rarely discussed in the theoretical literature. Unlike the previous literature, this paperâ€™s theory nests all the typical modes of supply, including exports, horizontal and vertical FDI, horizontal and vertical export platform FDI. The theory yields the testable hypothesis that a decrease in either inter-regional or intra-regional trade costs induces firms to choose export platform FDI. The empirical analysis provides descriptive statistics which point to large proportions of third country exports of US FDI, and an econometric analysis, whose results are in line with the modelâ€™s predictions. The last section suggests policy implications for nations seeking to attract FDI.
|Date of creation:||Dec 2012|
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|Publication status:||Published in IDE Discussion Paper. No. 378. 2012.12|
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References listed on IDEAS
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- Mitsuyo Ando & Fukunari Kimura, 2005.
"The Formation of International Production and Distribution Networks in East Asia,"
in: International Trade in East Asia, NBER-East Asia Seminar on Economics, Volume 14, pages 177-216
National Bureau of Economic Research, Inc.
- Mitsuyo Ando & Fukinari Kimura, 2003. "The Formation of International Production and Distribution Networks in East Asia," NBER Working Papers 10167, National Bureau of Economic Research, Inc.
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