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The Globalization Of Investment

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  • Timothy Koechlin

Abstract

This paper questions the commonplace assumption that the accumulation of capital has become a global phenomenon. Evidence suggests that, far from transcending the boundaries of the nation state, productive investment remains an essentially national phenomenon. The great bulk of investment is domestic investment undertaken by domestic firms. Little evidence exists to support the claim that investment decisions are sensitive to international profit rate differentials. Furthermore, strong evidence suggests that the nationality of a multinational corporation significantly influences its likely pattern of foreign investment. Data indicate that sweeping assertions about the globalization of capital provide a poor basis for understanding both the process of capital accumulation and its implications for workers, communities, and policymakers.

Suggested Citation

  • Timothy Koechlin, 1995. "The Globalization Of Investment," Contemporary Economic Policy, Western Economic Association International, vol. 13(1), pages 92-100, January.
    • Handle: RePEc:bla:coecpo:v:13:y:1995:i:1:p:92-100
    DOI: 10.1111/j.1465-7287.1995.tb00716.x
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    References listed on IDEAS

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    1. Kravis, Irving B. & Lipsey, Robert E., 1982. "The location of overseas production and production for export by U.S. multinational firms," Journal of International Economics, Elsevier, vol. 12(3-4), pages 201-223, May.
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    Cited by:

    1. Günther G. Schulze & Heinrich W. Ursprung, 1999. "Globalisation of the Economy and the Nation State," The World Economy, Wiley Blackwell, vol. 22(3), pages 295-352, May.
    2. Manuel B. Aalbers, 2009. "The Globalization and Europeanization of Mortgage Markets," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 33(2), pages 389-410, June.
    3. Bae, Sung C. & Noh, Seungwook, 2001. "Multinational corporations versus domestic corporations: a comparative study of R&D investment activities," Journal of Multinational Financial Management, Elsevier, vol. 11(1), pages 89-104, February.
    4. Witte, Caroline T. & Burger, Martijn J. & Pennings, Enrico, 2020. "When political instability devaluates home-host ties," Journal of World Business, Elsevier, vol. 55(4).

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