Location choices of multinational firms in Europe: The role of EU cohesion policy

Basile, Roberto; Castellani, Davide; Zanfei, Antonello

doi:10.1016/j.jinteco.2007.08.006

Cited by 225 publications

(258 citation statements)

References 21 publications

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“…Hence, it is not possible to model a discrete choice process with a first step decision on the entry mode and a second step decision on the chosen location as proposed by Mayer, Méjean, and Nefussi (2007). As Basile, Castellani, and Zanfei (2008) point out, however, this shortcoming does not affect the explanatory variable coefficients if the error terms of the two nests (entry mode and location choice) are uncorrelated. In this case, changes in the profitability of one entry mode entail proportional changes in the profitability of each location choice without affecting the odds ratios.…”

Section: The Nested Logit Modelmentioning

confidence: 99%

Network and border effects: Where do foreign multinationals locate in Germany?

Spies

2010

Regional Science and Urban Economics

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This study assesses the determinants of location choices of foreign multinational firms at the level of German federal states. Adjacency and existing firm networks are assumed to influence the investors' profits in a given location by overcoming informational disadvantages when entering the new market. A conditional and a nested logit model resemble the structure of the location choice process of individual investors well. By using affiliate-level data between 1997 and 2005, the results confirm that firms react positively to local demand, a common border and existing firm networks, while unit labour costs exhibit the expected negative impact. In the sectoral estimations, it is shown that these effects vary in their relevance among manufacturing and service affiliates, and between upstream and downstream activities.

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Section: The Nested Logit Modelmentioning

confidence: 99%

Network and border effects: Where do foreign multinationals locate in Germany?

Spies

2010

Regional Science and Urban Economics

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“…As we showed in the literature review, tax policies and facilities are com-monly used to alter firm incentives to conduct R&D in particular countries (Hines, 1995) and in the EU (Basile et al, 2008;Guimon,´ 2011). The use of tax incentives to attract multinational investment, as well as investment requirements for market access, is well documented (Koenig & MacGarvie, 2008;Jensen et al, 2011;Cincera et al, 2012).…”

Section: Facilitiesmentioning

confidence: 93%

“…In this article, we focus on the last step of this process (Devereux & Griffith, 1998;Head & Mayer, 2004;Basile et al, 2008).…”

Section: Methodsmentioning

confidence: 99%

“…Moreover, tax policies and facilities are commonly used to alter firms' incentives to conduct R&D in particular countries (Hines, 1995) and in the EU (Basile et al, 2008;Guimon,´ 2011). Many authors (Koenig & MacGarvie, 2008;Jensen, Thursby, & Thursby, 2011;Cincera, Cozza, & Tuebke, 2012) studied the use of tax incentives to attract multinational investment, as well as investment requirements for market ac-cess, showing an important interest by MNEs in this factor.…”

Section: Other Studiesmentioning

confidence: 99%

“…Sun, 2003), the choice of the location of R&D centers (Dougherty, Inklaar, McGuckin, & Van Ark, 2003;Belderbos, Lykogianni, & Veugelers, 2008), the organization of R&D networks all around the world (Alfaro & Chen, 2009) and the MNE strategies to run a global R&D process (Arora, Fosfuri, & Gambardella, 2001;Chesbrough, 2003;Ernst, 2005). Furthermore, the majority of studies are focused on a national-single country dimension or on a supranational level, with particular attention to the United States (Florida, 1997) and to the EU (Basile, Castellani, & Zanfei, 2008). Hence, there is a lack of contribution related to the location of foreign R&D at a regional/local level.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

The Localization Choice of Multinational Firms’ R&D Centers: A Survey in the Piedmont Area

Bresciani¹,

Ferraris²

2014

Journal of Promotion Management

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Research on the linkages between R&D, environment, strategy, and localization choices is quite new and often lacks empirical investi-gation. The aim of this article is to study the localization choices of MNE R&D activities in Piedmont. Specifically, it investigates the ex-tent of locating in a specific place on the strength of several drivers and the level of satisfaction of the choice after 3 years from the settlement. The findings aim to verify the main drivers that led 51 MNE to choose Piedmont as the ideal area for their R&D activities and also to show how the high level of presence after 3 years from the settlement confirms the result.

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Complex Strategic Choices: A New Approach and Application to Foreign Firm Agglomeration

Salomon

Martín

2017

Global Strategy Journal

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Research summary: In this study, we introduce a new statistical technique to the field of strategy that accounts for complex interrelated decisions. The technique is meant for situations in which one strategic decision depends critically upon another-e.g., where companies must commit to one decision before making another. We demonstrate the value of the technique in the context of companies choosing countries in which to invest, followed by areas within those countries in which to locate their facilities. We then describe the generic benefits of the statistical technique, offer guidance for how to use it, and provide the programming code so that others can implement it. We explain how the technique is particularly well suited to problems in which companies must decide between multiple options and the sample size is small relative to the number of initial options.Managerial summary: Research in strategy and international business has increasingly adopted two-stage models to account for endogeneity. Established approaches, however, deal most effectively with problems characterized by binary first-stage models. We introduce an alternative that allows for multiple choices in the first stage. We use the technique to examine the agglomeration patterns of foreign firms, while accounting for country selection. We find that, conditional on country selection, foreign firms tend to agglomerate in host countries characterized by collectivist cultures, political uncertainty, and economic uncertainty. The results imply that host country characteristics exert a strong influence on the agglomeration preferences of foreign firms. We provide guidance on when to use the empirical estimation technique and furnish details of the estimation procedure so that others can apply the technique to a broader class of selection problems.

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Location choices of multinational firms in Europe: The role of EU cohesion policy

Cited by 225 publications

References 21 publications

Network and border effects: Where do foreign multinationals locate in Germany?

Network and border effects: Where do foreign multinationals locate in Germany?

The Localization Choice of Multinational Firms’ R&D Centers: A Survey in the Piedmont Area

Complex Strategic Choices: A New Approach and Application to Foreign Firm Agglomeration

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