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Foreign direct investment and the single market
Author(s)
Date Issued
2002-05
Date Available
2009-07-28T15:18:08Z
Abstract
This paper extends the theory of multinational corporations, identifying three distinct influences of internal trade liberalisation by a group of countries on the level and pattern of inward foreign direct investment (FDI). First, the tariff-jumping motive encourages plant consolidation. Second, the export platform motive favours FDI with only a single union plant relative to exporting, and may induce a firm which has never exported to invest. Finally, reduced internal tariffs increase competition from domestic firms, which dilutes the other motives and may induce a "Fortress Europe" outcome of multinationals leaving union markets
even though external tariffs are unchanged.
even though external tariffs are unchanged.
Sponsorship
Economic and Social Research Council (ESRC)
Type of Material
Working Paper
Publisher
University College Dublin. School of Economics
Series
UCD Centre for Economic Research Working Paper Series
WP01/24
Classification
F15
F23
F12
Subject – LCSH
International business enterprises
Free trade
Investments, Foreign
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
File(s)
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Name
WP01.24.pdf
Size
320.79 KB
Format
Adobe PDF
Checksum (MD5)
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