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Who Goes Where and How? Firm Heterogeneity and Location Decision of Korean Multinationals

Author

Listed:
  • Hyun , Hea-Jung

    (Korea Institute for International Economic Policy)

  • Hur , Jung

    (Sogang University)

Abstract

This paper examines the role of firm heterogeneity in multinationals' choice of FDI type and location. Using Korean firm-level data, we find that more productive firms are more likely than their less efficient counterparts to invest in tough markets and choose horizontal FDI against vertical or export-platform FDI across different host countries. These findings, consistent with the recent theories in international economics, suggest that firm heterogeneity may play a significant role in FDI strategy as well as location decision.

Suggested Citation

  • Hyun , Hea-Jung & Hur , Jung, 2010. "Who Goes Where and How? Firm Heterogeneity and Location Decision of Korean Multinationals," Working Papers 10-11, Korea Institute for International Economic Policy.
  • Handle: RePEc:ris:kiepwp:2010_011
    DOI: 10.2139/ssrn.2489816
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    More about this item

    Keywords

    Multinationals; Firm Level; Foriegn Direct Investment; Firm Heterogeneity; FDI Type; Location Decision;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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