We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Product Market Competition and FDI Decisions.
- Authors
Loncan, Tiago
- Abstract
I examine whether competition from domestic industry rivals affects firms' proclivity to undertake foreign direct investment (FDI) and their country location choices. I find that competition affects foreign production decisions and the geography of international investments. While firms enduring stiffer competition are significantly less likely to undertake FDI, this effect is heterogeneous across firms. Competition deters FDI more strongly when costs are heavier, whereas it has weaker effects when efficiency is higher, growth opportunities are valuable, and cash reserves are higher. FDI location models suggest that when going abroad, firms facing stronger competition are more likely to pursue economies of productivity and taxation.
- Subjects
ECONOMIC competition; FOREIGN investments; DOMESTIC markets; INDUSTRIAL productivity; TAXATION; DECISION making in business
- Publication
Journal of Financial & Quantitative Analysis, 2023, Vol 58, Issue 6, p2617
- ISSN
0022-1090
- Publication type
Article
- DOI
10.1017/S0022109022000679