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Intra-firm trade in the context of European integration: evidence from the French multinational agribusiness

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  • Emmanuelle Chevassus-Lozza

    (National Institute of Agronomic Research, INRA, UR1134, rue de laGéraudière, BP 1627, 44316 Nantes Cdx 03. France)

  • Danielle Galliano

    (INRA, UR 0685, F-31326 Castanet Tolosan, France)

Abstract

This article identifies the factors that lead multinational firms to internalize their international exchanges and aims to determine the impact of the implementation of the Single European Market on firms' strategies. We analyze the interaction between the microeconomic characteristics of firms and those of their environment because this interaction determines a multinational firm's decision to internalize trade. The empirical work is based on the 'industrial globalization' survey conducted by the French statistics institutes in 1993 and 1999. With regard to the French agri-food trade, there has been an increase in intra-firm (IFT) trade within the EU-15 borders and the European multinational networks. The main determinants of intra-firm trade are the firms' need to generate economies of scale and to protect and exploit their 'firm-specific advantages' related to the technology and nature of the product. The model sheds light on the role and the development of intra-regional networks of subsidiaries. [JEL classifications: F10, F14, F23]. © 2009 Wiley Periodicals, Inc.

Suggested Citation

  • Emmanuelle Chevassus-Lozza & Danielle Galliano, 2009. "Intra-firm trade in the context of European integration: evidence from the French multinational agribusiness," Agribusiness, John Wiley & Sons, Ltd., vol. 25(1), pages 128-143.
    • Handle: RePEc:wly:agribz:v:25:y:2009:i:1:p:128-143
    DOI: 10.1002/agr.20188
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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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