Agglomeration and FDI: Bringing International Production Linkages into the Picture
By: Stöllinger, Roman.
Material type: BookSeries: wiiw Working Papers: 121Publisher: Wien : Wiener Institut für Internationale Wirtschaftsvergleiche (wiiw), 2015Description: 42 S., 9 Tables and 4 Figures, 30cm.Subject(s): foreign direct investment | multinational enterprises | location choice | agglomeration | international linkagesCountries covered: European Unionwiiw Research Areas: International Trade, Competitiveness and FDIClassification: F21 | F23 | R30 Online resources: Click here to access online Summary: Abstract The attractiveness of a country for foreign direct investors stems from domestic factors but also from its interconnectedness with the global economy. While knowledge spillovers and domestic inter-industry linkages have been examined by the literature on FDI location, international linkages have been neglected due to data constraints. Using global input-output data, this paper investigates the role of backward and forward production linkages between countries for location choices of first-time greenfield FDI investors in the EU along with traditional agglomeration forces. In line with the literature it is found that firms tend to co-locate with other firms from the same country and industry. Most importantly, inter-industry linkages between the source and the host country emerge as an important attraction factor while the same does not hold for domestic inter-industry linkages.Item type | Current library | Call number | Status | Date due | Barcode | |
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Paper | WIIW Library | 5.700/121 (Browse shelf(Opens below)) | Available | 1000010003757 |
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Abstract
The attractiveness of a country for foreign direct investors stems from domestic factors but also from its interconnectedness with the global economy. While knowledge spillovers and domestic inter-industry linkages have been examined by the literature on FDI location, international linkages have been neglected due to data constraints. Using global input-output data, this paper investigates the role of backward and forward production linkages between countries for location choices of first-time greenfield FDI investors in the EU along with traditional agglomeration forces. In line with the literature it is found that firms tend to co-locate with other firms from the same country and industry. Most importantly, inter-industry linkages between the source and the host country emerge as an important attraction factor while the same does not hold for domestic inter-industry linkages.