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http://hdl.handle.net/10419/22050
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| Title: | | Firm Productivity and the Foreign-Market Entry Decision  |
| Authors: | | Raff, Horst Ryan, Michael Stähler, Frank |
| Issue Date: | | 2008 |
| Series/Report no.: | | Economics working paper / Christian-Albrechts-Universität Kiel, Department of Economics 2008,02 |
| Abstract: | | We use Japanese firm-level data to examine how a firm?s productivity affects its choice of foreign-market entry strategy. We study a sequence of decisions, starting with the choice between exporting and foreign direct investment (FDI). In the case of FDI, the firm faces two options: greenfield investment or merger and acquisition (M&A). If it selects greenfield investment, it has two ownership choices: whole ownership or a joint venture. Controlling for industry- and country-specific characteristics, we find that the more productive a firm is, the more likely it is to choose FDI rather than exporting, greenfield investment rather than M&A, and whole ownership rather than a joint venture. We also find that the assumed sequence of decisions fits the data better than alternative specifications. |
| Subjects: | | Foreign direct investment merger and acquisition joint venture greenfield investment firm heterogeneity productivity |
| JEL: | | F15 F12 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Economics Working Papers, Department of Economics, CAU Kiel
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