| Author Name | ITO Tadashi (Gakushuin University) / TANAKA Ayumu (Research Associate, RIETI) |
|---|---|
| Creation Date/NO. | March 2020 20-E-017 |
| Research Project | Studies on Foreign Direct Investment and Trade in Relation to FDI |
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Abstract
The standard firm heterogeneity model of FDI considers the case of whole ownership of foreign affiliates. However, there exist many partially-owned foreign affiliates. This paper builds a model based on Helpman et al. (2004) to allow various ownership structures and posits some testable hypotheses on the relationship between productivity and ownership shares/structures. The empirical part corroborates these hypotheses, showing that high productivity firms have higher ownership share in their affiliates and lower productivity firms tend to opt for joint-ventures with wholesalers and/or local/3rd country partners.
Published: Ito, Tadashi, and Ayumu Tanaka, 2022. "FDI, ownership structure, and productivity," Japan and The World Economy, Volume 64 (2022), 101158.
https://doi.org/10.1016/j.japwor.2022.101158
