Premium
External Liberalization and Foreign Presence: Cross‐Industry Evidence from Poland and Hungary
Author(s) -
Kennedy Robert E.
Publication year - 2000
Publication title -
journal of economics and management strategy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.672
H-Index - 68
eISSN - 1530-9134
pISSN - 1058-6407
DOI - 10.1111/j.1430-9134.2000.00231.x
Subject(s) - liberalization , foreign direct investment , international economics , international trade , business , free trade , economic liberalization , investment (military) , economics , market economy , political science , politics , macroeconomics , law
External liberalization—the relaxation of restrictions on cross‐border trade and inbound direct investment—has played an important role in the programs of economic transition in central Europe. While liberalization is widely heralded, there has been little empirical analysis of the links between liberalization and industry structure. This analysis examines changes in foreign presence following external liberalization in Poland and Hungary. I show that the presence of proprietary and intangible assets explains much of the cross‐industry variation in patterns of foreign presence and, for a given level of foreign presence, whether this will occur via trade or inbound direct investment.