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Title:Multinational companies and indigenous development : an empirical analysis
Authors:Görg, Holger
Strobl, Eric
Issue Date:2002
Citation:[Journal:] European economic review [ISSN:] 0014-2921 [Volume:] 46 [Year:] 2002 [Issue:] 7 [Pages:] 1305-1322
Abstract:This paper presents an empirical study of the effect of foreign multinational companies on the development of indigenous firms in the host country. Our starting point is a recent paper by Markusen and Venables (European Economic Review 43 (1999) 335-356) that shows formally that multinationals, through the creation of linkages with indigenous suppliers, can exert positive effects on the development of indigenous firms. Based on the literature on entry in industrial organisation, we estimate empirically a model describing the entry of indigenous firms using data for the Irish manufacturing sector. Our results indicate that there is a positive effect of multinational companies on the entry of indigenous firms for a variety of alternative specifications.
Subjects:Multinational companies
Firm entry
Host country development
JEL:F23
L60
Persistent Identifier of the first edition:doi:10.1016/S0014-2921(01)00146-5
Document Type:Article
Appears in Collections:Economists Online

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