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PRODUCTIVITY DIFFERENCES AND STRATEGIC PLANT LOCATION *
Author(s) -
GUARIGLIA ALESSANDRA,
MUKHERJEE ARIJIT,
SUETRONG KULLAPAT
Publication year - 2013
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/j.1467-9957.2012.02332.x
Subject(s) - multinational corporation , productivity , business , host (biology) , industrial organization , investment (military) , economics , foreign direct investment , international trade , economic growth , finance , macroeconomics , biology , ecology , politics , political science , law
We consider the plant location decision of a multinational company (MNC), which has the option to invest in technologically differentiated countries. We show that the MNC's investment decision depends on the market structure of the host countries and on the possibility of exporting by the host‐country firms. We also show that a conflict of interest does not necessarily arise between the plant location decision of the MNC and the preferences of the host countries.