A Two-dimensional Analysis of the Impact of Outward FDI on Performance at Home: Evidence from Japanese manufacturing firms

Author Name OBASHI Ayako (Keio University) / HAYAKAWA Kazuo (Inter-disciplinary Studies Center, Institute of Developing Economies) / MATSUURA Toshiyuki (Keio University) / MOTOHASHI Kazuyuki (Faculty Fellow, RIETI)
Creation Date/NO. October 2009 09-E-053
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This paper empirically investigates two areas of changes in firm behavior and performance at home before and after investing abroad. The first is the type of foreign direct investment (FDI): horizontal FDI or vertical FDI. The second is the firm's domestic activities of interest: production activity and non-production activity. From a theoretical standpoint, the impact of outward FDIs differs not only by type, but according to the firm’s activities. By exploiting two types of firm-level data that enable us to distinguish between production and non-production activities, our work provides a detailed picture of the intra-firm changes in behavior and performance that occur as a result of globalizing production.

Published: Kazunobu Hayakawa, Toshiyuki Matsuura, Kazuyuki Motohashc, Ayako Obashi, 2013. "Two-dimensional analysis of the impact of outward FDI on performance at home: Evidence from Japanese manufacturing firms," Japan and the World Economy, Vol. 27, pp. 25-33.