Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/72365
Authors: 
Neary, J. Peter
Year of Publication: 
2002
Series/Report no.: 
Working Paper Series, UCD Centre for Economic Research 01/24
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.
Subjects: 
Foreign direct investment
market integration
multinational corporations
Single Market
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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