Do U.S. Multinationals Engage In Sequential Choice?: Evidence from New Manufacturing Operations in Europe
Despite an extensive literature on the determinants of the foreign location choices by multinational companies, researchers have only recently begun to systematically examine how these companies form their location consideration sets. When considering new foreign locations, do firms evaluate the attributes of the alternatives at the national level, the sub-national regional level, at some other level of geographical aggregation, or using some combination of these? This paper employs discrete choice models to examine how U.S. multinational companies form their location consideration sets and to identify some of the relevant location attributes. The results indicate that U.S. firms tend to employ a sequential, or hierarchical, decision-making process in which a host country is first chosen based on one set of attributes and then a region within that country is chosen based on another set of attributes. The relevant location attributes include industrial agglomeration and labor market conditions.
|Date of creation:||14 Nov 2007|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
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.:
- Grether, David & Wilde, Louis, 1984. " An Analysis of Conjunctive Choice: Theory and Experiments," Journal of Consumer Research, University of Chicago Press, vol. 10(4), pages 373-85, March.
- Park, C Whan & Lessig, V Parker, 1981. " Familiarity and Its Impact on Consumer Decision Biases and Heuristics," Journal of Consumer Research, University of Chicago Press, vol. 8(2), pages 223-30, September.
- Hideki Yamawaki, 2006. "The location of American and Japanese multinationals in Europe," International Economics and Economic Policy, Springer, vol. 3(2), pages 157-173, November.
- Jean-Louis Muchielli & Florence Puech, 2004. "Globalization, agglomeration and FDI location: the case of French firms in Europe," Chapters, in: Multinational Firmsâ€™ Location and the New Economic Geography, chapter 2 Edward Elgar.
- Stephen Yeaple & Volker Nocke, 2005.
"An Assignment Theory of Foreign Direct Investment,"
2005 Meeting Papers
146, Society for Economic Dynamics.
- Volker Nocke & Stephen Yeaple, 2004. "An Assignment Theory of Foreign Direct Investment," NBER Working Papers 11003, National Bureau of Economic Research, Inc.
- Volker Nocke & Stephen Yeaple, 2004. "An Assignment Theory of Foreign Direct Investment," PIER Working Paper Archive 05-003, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
- J. A. Hausman, 1976.
"Specification Tests in Econometrics,"
185, Massachusetts Institute of Technology (MIT), Department of Economics.
- Subramanian Rangan, 2000. "Search and Deliberation in International Exchange: Microfoundations to Some Macro Patterns," Journal of International Business Studies, Palgrave Macmillan, vol. 31(2), pages 205-222, June.
- Ronald C. Fisher, 1997. "Effects of state and local public services on economic development," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 53-82.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:20195. 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: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.