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Locational determinants of the US direct foreign investment in food and kindred products
Author(s) -
Ning Yulin,
Reed Michael R.
Publication year - 1995
Publication title -
agribusiness
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.57
H-Index - 43
eISSN - 1520-6297
pISSN - 0742-4477
DOI - 10.1002/1520-6297(199501/02)11:1<77::aid-agr2720110108>3.0.co;2-0
Subject(s) - economics , foreign direct investment , investment (military) , macroeconomics , political science , politics , law
This article investigates locational determinants of US direct foreign investment (DFI) in food and kindred products by using data from six industrialized countries from 1983 to 1989. Separate equations were fitted to explain DFI position, outflow, and reinvestment. Cultural linkages, trading blocs, host market size, tax considerations, exchange differentials, and host market growth rates are found to be significant determinants of DFI in food manufacturing. Wage rate differentials were found to be important in the position and reinvested equations, but not in the outflow equation. Thus, cheap labor may not be as important in attracting DFI as in the past. © 1995 by John Wiley & Sons, Inc.