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Foreign Direct Investment and the Single Market

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  • J. Peter Neary

    (University College Dublin and CEPR)

Abstract

In this paper, I present a simple framework in which some of these issues can be considered. I focus on a single industry (so general equilibrium repercussions are ignored), and on the location decisions of a single potential multinational firm. I begin by paying more attention than usual to the non- strategic bench-mark case where the multinational firm has a monopoly and faces no competition from domestic firms. Subsequently I relax this assumption, but even then I simplify by allowing a limited role for domestic firms.

Suggested Citation

  • J. Peter Neary, 2001. "Foreign Direct Investment and the Single Market," Development Working Papers 160, Centro Studi Luca d'Agliano, University of Milano.
    • Handle: RePEc:csl:devewp:160
    as

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    File URL: https://www.dagliano.unimi.it/media/WP2001_160.pdf
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    References listed on IDEAS

    as
    1. James R. Markusen & Anthony J. Venables, 2021. "The theory of endowment, intra-industry and multi-national trade," World Scientific Book Chapters, in: BROADENING TRADE THEORY Incorporating Market Realities into Traditional Models, chapter 4, pages 69-94, World Scientific Publishing Co. Pte. Ltd..
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    5. Motta, Massimo, 1992. "Multinational firms and the tariff-jumping argument : A game theoretic analysis with some unconventional conclusions," European Economic Review, Elsevier, vol. 36(8), pages 1557-1571, December.
    6. Zhao, Jingang, 2001. "A characterization for the negative welfare effects of cost reduction in Cournot oligopoly," International Journal of Industrial Organization, Elsevier, vol. 19(3-4), pages 455-469, March.
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    8. Venables, Anthony J., 1990. "International capacity choice and national market games," Journal of International Economics, Elsevier, vol. 29(1-2), pages 23-42, August.
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    12. Motta, Massimo & Norman, George, 1996. "Does Economic Integration Cause Foreign Direct Investment?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(4), pages 757-783, November.
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    More about this item

    Keywords

    Foreign direct investment; market integration; multinational corporations; single market;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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