The location of inward investment, technical change and skilled labour: Evidence from the United States

Abstract

This study provides an empirical analysis of US inward foreign direct investment (FDI) with particular reference to the role of skilled labour. The theoretical foundations of the analysis are rooted in OLI theory and, in particular, its locational aspects. However, the empirical techniques employed are e more commonly associated with factor proportions theory. Thus, the contribution of the paper is partly methodological in applying such techniques to the determinants of inward FDI. The paper also produces evidence that US inward FDI is focused on skill intensive economic activities, using multiple categories of skilled labour. It also finds that strategic asset seeking behaviour focused on skilled labour overlaps with efficiency seeking behaviour linked to productivity change, export activity and market seeking behaviour.

Foreign Location Choice: Review and Extensions

“…Taken together, this approach offers the best hope for IB to rekindle its research fire.' We concur with this assessment, as analyzing the myriad changes taking place in the global economy requires moving beyond IB's traditionally country-centric approach and towards disaggregating spatial units of analyses into smaller chunks such as states/provinces (Chidlow et al 2009;Chung and Alcácer 2002;Nicholas et al 2001;Villaverde and Maza 2012;Webster 2013;Wu and Strange 2000), clusters (Manning et al 2010;Nachum and Keeble 2003;Zaheer and Manrakhan 2001) and cities (Boeh and Beamish 2012;Goerzen et al 2013;Ma and Delios 2007;. The IB field's expertise regarding the organizational process of MNEs can be usefully integrated with NEG scholars' expertise in the subnational spatial dynamics of economic activities and applied towards pushing the boundaries of research on foreign-location choice.…”

“…; Chung and Alcácer ; Nicholas et al . ; Villaverde and Maza ; Webster ; Wu and Strange ), clusters (Manning et al . ; Nachum and Keeble ; Zaheer and Manrakhan ) and cities (Boeh and Beamish ; Goerzen et al .…”