scholarly journals Information related service trade within firms: evidence from firm-level data in Germany

2021 ◽  
Author(s):  
Kurt A. Hafner ◽  
Jörn Kleinert
Keyword(s):  
Multinational Firms ◽  
Economies Of Scope ◽  
It Services ◽  
Firm Level ◽  
It Service ◽  
Level Data ◽  
Related Service ◽  
Foreign Affiliates ◽  
Knowledge Intensive ◽  
Parent Companies

AbstractMulti-unit firms have productivity advantages over competitors because of their use of a non-rival asset—firm-specific knowledge—in several units. Using knowledge-intensive services leads to economies of scope in production by multi-unit firms. Such headquarter are usually supplied by parent companies and serve to link different firm units. Headquarter services are difficult to quantify in statistics or surveys, except when they cross-borders and the exchange of services between MNEs and their offshore subsidiaries becomes apparent. This study therefore focuses on IT service imports to explain productivity differences among foreign affiliates of multinational firms in Germany. The authors base the analysis on the population of foreign multinational firms active in Germany and analyze what effect the import of IT services has on their productivity. They find that IT headquarter service flows have significant impacts on foreign affiliates’ productivity in general and US affiliates in particular. As the average IT-service flows (per firm and partner) from parent countries are significantly higher for US affiliates than non-US affiliates, they conclude that the import of IT services from the parent-company is a source of the productivity advantages of US affiliates in Germany.

scholarly journals Global Production with Export Platforms*

2016 ◽  
Vol 132 (1) ◽  
pp. 157-209 ◽  
Author(s):  
Felix Tintelnot
Keyword(s):  
General Equilibrium ◽  
Host Country ◽  
Foreign Investment ◽  
Multinational Firms ◽  
Multinational Enterprise ◽  
Fixed Costs ◽  
Firm Level ◽  
Level Data ◽  
Multinational Production ◽  
Foreign Affiliates

Abstract Most international commerce is carried out by multinational firms, which use their foreign affiliates both to serve the market of the host country and to export to other markets outside the host country. In this article, I examine the determinants of multinational firms’ location and production decisions and the welfare implications of multinational production. The few existing quantitative general equilibrium models that incorporate multinational firms achieve tractability by assuming away export platforms—that is, they do not allow foreign affiliates of multinationals to export—or by ignoring fixed costs associated with foreign investment. I develop a quantifiable multicountry general equilibrium model, which tractably handles multinational firms that engage in export platform sales and that face fixed costs of foreign investment. I first estimate the model using German firm-level data to uncover the size and nature of costs of multinational enterprise and show that the fixed costs of foreign investment are large. Second, I calibrate the model to data on trade and multinational production for twelve European and North American countries. Counterfactual analysis reveals that multinationals play an important role in transmitting technological improvements to foreign countries and that the pending Canada-EU trade and investment agreement could divert a sizable fraction of the production of EU multinationals from the U.S. to Canada.

The Gravity of Knowledge

2013 ◽  
Vol 103 (4) ◽  
pp. 1414-1444 ◽  
Author(s):  
Wolfgang Keller ◽  
Stephen Ross Yeaple
Keyword(s):  
Knowledge Transfer ◽  
Multinational Firms ◽  
Multinational Firm ◽  
Firm Level ◽  
Direct Communication ◽  
Multinational Activity ◽  
Level Data ◽  
Firm Level Data ◽  
Foreign Affiliates ◽  
Firm Model

We analyze the international operations of multinational firms to measure the spatial barriers to transferring knowledge. We model firms that can transfer bits of knowledge to their foreign affiliates in either embodied (traded intermediates) or disembodied form (direct communication). The model shows how knowledge transfer costs can be inferred from multinationals' operations. We use firm-level data on the trade and sales of US multinationals to confirm the model's predictions. Disembodied knowledge transfer costs not only make the standard multinational firm model consistent with the fact that affiliate sales fall in distance but quantitatively accounts for much of the gravity in multinational activity. (JEL F12, F14, F23, L25, O33)

scholarly journals Measuring Global Value Chains

2018 ◽  
Vol 10 (1) ◽  
pp. 207-236 ◽  
Author(s):  
Robert C. Johnson
Keyword(s):  
Multinational Firms ◽  
Bilateral Trade ◽  
Value Added ◽  
Global Value Chains ◽  
Value Chains ◽  
Production Networks ◽  
Input Output ◽  
Firm Level ◽  
Level Data ◽  
Production Stages

Recent decades have seen the emergence of global value chains (GVCs), in which production stages for individual goods are broken apart and scattered across countries. Stimulated by these developments, there has been rapid progress in data and methods for measuring GVC linkages. The macro approach to measuring GVCs connects national input–output tables across borders by using bilateral trade data to construct global input–output tables. These tables have been applied to measure trade in value added, the length of and location of producers in GVCs, and price linkages across countries. The micro approach uses firm-level data to document firms’ input sourcing decisions, how import and export participation are linked, and how multinational firms organize their production networks. In this review, I evaluate progress in these two approaches, highlighting points of contact between them and areas that demand further work. I argue that further convergence between these approaches can strengthen both, yielding a more complete empirical portrait of GVCs.

Who Gets the Money?

2010 ◽  
Vol 230 (5) ◽  
Author(s):  
Birgit Aschhoff
Keyword(s):  
Public Funding ◽  
Public Support ◽  
Service Firms ◽  
Multivariate Approach ◽  
Firm Level ◽  
The Past ◽  
Level Data ◽  
Funding Scheme ◽  
Knowledge Intensive ◽  
High Level

SummaryIn this paper I analyze which firms receive R&D project grants and how this public support evolves over time by considering in particular firm’s previous participation. The extent of the dynamics of firms’ participation within the funding scheme gives information about the openness of the scheme towards non-participating firms. Using firm-level data on German manufacturing and knowledge-intensive service firms, it turns out that participation in the funding scheme shows a rather high level of continuity. This is also confirmed by applying a multivariate approach. Firms which received funding in the past are more likely to be selected for public funding again. Moreover, a firm’s size and knowledge capabilities increase the probability of entering the scheme.

Collective Technology Learning Between Transnational Corporations and Local Business Partners: The Case of West Sweden

10.1068/a3595 ◽  
2002 ◽  
Vol 34 (10) ◽  
pp. 1877-1897 ◽  
Author(s):  
Inge Ivarsson
Keyword(s):  
Transnational Corporations ◽  
Multiple Logistic Regression ◽  
Industry Clusters ◽  
Firm Level ◽  
Technology Learning ◽  
Business Partners ◽  
Local Business ◽  
Technological Cooperation ◽  
Level Data ◽  
Foreign Affiliates

Unique firm-level data from 287 majority-owned foreign affiliates (MOFAs) located in West Sweden are used to analyse the extent in which transnational corporations (TNCs) in a developed host country have established technological linkages, leading to collective technology learning where both TNCs and their local business partners benefit. The findings indicate that local business partners have established substantial levels of organised technological cooperation, not only with manufacturing MOFAs but also with wholesale MOFAs supplying industrial products. This seems to result in collective technology learning where both MOFAs and business partners in Sweden, especially customers, earn advantages. In the case of manufacturing MOFAs, local business partners in West Sweden seem to be important as cooperative partners. By using a multiple logistic regression to analyse key determinants, it was found that the size of MOFAs positively affected the establishment of technological linkages to business partners in Sweden, among both manufacturing MOFAs and sales MOFAs. A positive correlation with linkage formation was also found among manufacturing MOFAs regarding both increasing age and the extent in which they operate within competitive Swedish industry clusters.

scholarly journals Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages

2004 ◽  
Vol 94 (3) ◽  
pp. 605-627 ◽  
Author(s):  
Beata Smarzynska Javorcik
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Foreign Ownership ◽  
Foreign Investments ◽  
Firm Level ◽  
Productivity Spillovers ◽  
Level Data ◽  
Firm Level Data ◽  
Foreign Affiliates ◽  
Backward Linkages

Many countries strive to attract foreign direct investment (FDI) hoping that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. In contrast with earlier literature that failed to find positive intraindustry spillovers from FDI, this study focuses on effects operating across industries. The analysis, based on firm-level data from Lithuania, produces evidence consistent with positive productivity spillovers from FDI taking place through contacts between foreign affiliates and their local suppliers in upstream sectors. The data indicate that spillovers are associated with projects with shared domestic and foreign ownership but not with fully owned foreign investments.

scholarly journals Regions, Innovations, and the North–South Divide in Italy

2021 ◽  
pp. 115-134
Author(s):  
Loet Leydesdorff
Keyword(s):  
Southern Italy ◽  
Interesting Case ◽  
High Tech ◽  
Firm Level ◽  
Knowledge Based ◽  
The North ◽  
Level Data ◽  
Eu Policies ◽  
Innovation Strategies ◽  
Knowledge Intensive

AbstractUsing firm-level data collected by Statistics Italy for 2008, 2011, and 2015, the Triple-Helix synergy among geographical and size distributions of firms and technology classes is analyzed both regionally and nationally. The Italian system is both knowledge-based and knowledge-intensive, and therefore an interesting case. The contributions to national synergy of the twenty regions in Italy have increased between 2008 and 2015, but synergy generation at levels above the regions has remained relatively stable at approximately 45%. As against the statistical classification into twenty regions, or into Northern, Central, and Southern Italy, the greatest synergy is retrieved by defining the country in terms of Northern and Southern Italy as two sub-systems, with Tuscany included as part of Northern Italy. Different innovation strategies could be developed for these two parts of the country. However, the current focus on twenty regions for innovation policies may to some extent be an artefact of the statistics and EU policies. In terms of sectors, both medium- and high-tech manufacturing (MHTM) and knowledge-intensive services (KIS) are integrated proportionally in the various regions.

scholarly journals US Environmental Regulation and FDI: Evidence from a Panel of US-Based Multinational Firms

2010 ◽  
Vol 2 (3) ◽  
pp. 158-189 ◽  
Author(s):  
Rema Hanna
Keyword(s):  
Foreign Investment ◽  
Multinational Firms ◽  
Clean Air Act ◽  
Econometric Models ◽  
Substantial Variation ◽  
Firm Level ◽  
Level Data ◽  
Regulated Firms ◽  
Firm Level Data ◽  
Clean Air

This paper measures the response of US-based multinationals to the Clean Air Act Amendments (CAAA). Using a panel of firm-level data over the period 1966–1999, I estimate the effect of regulation on a multinational's foreign production decisions. The CAAA induced substantial variation in the degree of regulation faced by firms, allowing for the estimation of econometric models that control for firm-specific characteristics and industrial trends. I find that the CAAA caused regulated multinational firms to increase their foreign assets by 5.3 percent and their foreign output by 9 percent. Heavily regulated firms did not disproportionately increase foreign investment in developing countries. (JEL F23, K32, L51, Q52, Q53, Q58)

scholarly journals Pollution Havens and Foreign Direct Investment: Dirty Secret or Popular Myth?

2003 ◽  
Vol 3 (2) ◽  
Author(s):  
Beata Smarzynska Javorcik ◽  
Shang-Jin Wei
Keyword(s):  
Soviet Union ◽  
Host Country ◽  
Former Soviet Union ◽  
Multinational Firms ◽  
Environmental Standards ◽  
Pollution Haven Hypothesis ◽  
Firm Level ◽  
Pollution Haven ◽  
Level Data ◽  
Industry Level Data

Abstract The “pollution haven” hypothesis refers to the possibility that multinational firms, particularly those engaged in highly polluting activities, relocate to countries with weaker environmental standards. Despite the plausibility and popularity of this hypothesis, the existing literature has found only limited evidence to support it. To enhance our ability to detect the possible “dirty secret,” this study makes improvements in four areas. First, we focus on investment flows from multiple countries to 25 economies in Eastern Europe and the former Soviet Union. Transition countries are a suitable region for studying this question, as they offer a large variation in terms of environmental standards. Second, we take into explicit account the effect of host country corruption. Third, we include information on both the polluting-intensity of the potential investor and the environmental stringency in the potential host country, which allows us to test whether dirty industries are relatively more attracted to locations with weak standards. And fourth, we rely on firm-level rather than industry-level data. Despite these improvements, we find no support for the “pollution haven” hypothesis. If anything, firms in less polluting industries are more likely to invest in the region. We find no systematic evidence that FDI from “dirtier” industries is more likely to go to countries with weak environmental regulations.

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