Is It Strategic to Attract the Service Activities of Multinational Firms? Some Empirical Evidence

Defever, Fabrice

doi:10.7551/mitpress/9780262026451.003.0011

Cited by 3 publications

(3 citation statements)

References 8 publications

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“…Other studies have investigated the location determinants of service functions within the manufacturing sector (Defever, 2006;2008) finding that within firm vertical linkages push firms to co-locate their service functions in countries where the firm already had a production plant.…”

Section: Introductionmentioning

confidence: 99%

The Determinants of Inward Foreign Direct Investment in Business Services across European Regions

2014

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The paper accounts for the determinants of inward foreign direct investment in business services across the EU-27 regions. Together with the traditional variables considered in the literature (market size, market quality, agglomeration economies, labour cost, technology, human capital), we focus on the role of forward linkages with manufacturing sectors and other service sectors as attractors of business services FDI at the regional level. This hypothesis is based on the evidence that the growth of business services is mostly due to increasing intermediate demand by other services industries and by manufacturing industries and on the importance of geographical proximity for forward linkages in services. Terms of use: Documents inTo our knowledge, there are no studies investigating the role of forward linkages for the location of FDI. This paper aims therefore to fill this gap and add to the FDI literature by providing a picture of the specificities of the determinants of FDI in business services at the regional level.The empirical analysis draws upon the database fDi Markets, from which we selected projects having as a destination NUTS 2 European regions in the sectors of Business services over the period [2003][2004][2005][2006][2007][2008]. Data on FDI have been matched with data drawn from the Eurostat Regio database. Forward linkages have been constructed using the OECD Input/Output database.By estimating a negative binomial model, we find that regions specialised in those (manufacturing) sectors that are high potential users of business services attract more FDI than other regions. This confirms the role of geographical proximity for forward linkages in services and shows the role played by the existing structure of domestic production for the localisation of business service FDI, particularly in the case of manufacturing.

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Section: Introductionmentioning

confidence: 99%

The Determinants of Inward Foreign Direct Investment in Business Services across European Regions

2014

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“…Economic geographers have looked more deeply at the local dimension of firms and their linkages with territories, and the literature on the relation between firms and the concepts of place, 2 See, among others, Basile et al (2006Basile et al ( , 2008, Cantwell and Piscitello, (2005), Crescenzi et al (2013), Defever (2006Defever ( , 2008Defever ( , 2012, Head and Mayer (2004), for studies of the location of MNEs in European regions, as well as studies on the location of multinationals within individual countries in Europe, such as France (Crozet et al, 2004), Italy (Bronzini, 2007;Mudambi and Navarra, 2003;Mariotti and Piscitello, 1995), Romania (Hilber and Voicu, 2010), Spain (Pelegrin and Bolancé, 2008), UK (Dimitropoulou, McCann and Burke, 2013). There are also various studies of location of MNEs across states in the U.S. (Head et al, 1999;Hennart and Park, 1994;Halvorsen, 2012;Nachum, 2000), and in other parts of the world, such as the study of Meyer and Nguyen (2005) on sub-national institutions in Vietnam.…”

Section: Heterogeneity Across Regionsmentioning

confidence: 99%

Heterogeneity and distance. some propositions on how differences across regions, firms and functions affect the role of distance in fdi location decisions

2014

Economia E Politica Industriale

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“…Other studies have investigated the location determinants of service functions within the manufacturing sector (Defever, 2006, 2008). Findings show that: (i) within‐firm vertical linkages push firms to co‐locate their service functions in countries with a production plant; and (ii) manufacturers have a positive impact on services employment in local labour markets (Ascani & Iammarino, 2018).…”

Section: Introductionmentioning

confidence: 99%

Tracking the Van: The role of forward linkages in logistics MNEs' location choices across European NUTS 3 regions

Ribaudo

2023

Papers in Regional Science

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Logistics firms play a crucial role in overcoming time and distance constraints in supply chain management. However, little is known about their location patterns. This paper fills the gap by studying the logistics of multi-national enterprises' location choices across 380 NUTS 3. Using data on 1777 foreign direct investments (FDIs), our findings reveal that forward linkages with a region's retail and wholesale industry exert a stronger impact than intermediate production demand. Results are robust to the inclusion of standard FDIs' determinants and to controls for spatial dependence.

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Is It Strategic to Attract the Service Activities of Multinational Firms? Some Empirical Evidence

Cited by 3 publications

References 8 publications

The Determinants of Inward Foreign Direct Investment in Business Services across European Regions

The Determinants of Inward Foreign Direct Investment in Business Services across European Regions

Heterogeneity and distance. some propositions on how differences across regions, firms and functions affect the role of distance in fdi location decisions

Tracking the Van: The role of forward linkages in logistics MNEs' location choices across European NUTS 3 regions

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