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Explaining variability in the investment location choices of MNEs: an exploration of country, industry and firm effects

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journal contribution
posted on 19.12.2016, 13:52 by Simona RasciuteSimona Rasciute, Paul DownwardPaul Downward
This paper examines the variation in foreign direct investment (FDI) location decisions of European multinational enterprises (MNEs.) An innovative empirical approach is applied to a new data set which contains over 15,000 individual FDI location decisions in 25 European countries over a 17-year period and combines country, industry and firm level factors. The empirical results show that the responsiveness of FDI location choices to country-level factors is heterogeneous both across sectors and across firms of different characteristics as well as unobserved factors. In particular the results show that the importance of the market size, good infrastructure and Western business and legal environment increases with investing firm’s size, while proximity, as well as cultural and linguistic ties are more important for smaller firms.

History

School

  • Sport, Exercise and Health Sciences

Published in

International Business Review

Volume

26

Issue

4

Pages

605 - 613

Citation

RASCIUTE, S. and DOWNWARD, P., 2017. Explaining variability in the investment location choices of MNEs: an exploration of country, industry and firm effects. International Business Review, 26(4), pp. 605-613.

Publisher

© Elsevier

Version

AM (Accepted Manuscript)

Publisher statement

This work is made available according to the conditions of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) licence. Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/

Acceptance date

06/12/2016

Publication date

2016-12-15

Notes

This paper was accepted for publication in the journal International Business Review and the definitive published version is available at http://dx.doi.org/10.1016/j.ibusrev.2016.12.002

ISSN

1873-6149

Language

en