Global Production Sharing and the FDI Trade Nexus: New Evidence from the Japanese Automobile Industry

Shuhei Nishitateno

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: The growing importance of global production sharing makes the nexus between outward foreign direct investment (FDI) and trade in parts and components ever more important. This paper examines the impact of overseas operation of upstream firms (parts and components suppliers) on parts and components exports from the home country through a case study of the Japanese automobile industry. The empirical analysis is based on a newly-constructed product-level dataset covering 32 products and 49 host countries over the period 1993 to 2008. It is found that overseas operation of upstream firm lead to additional exports of intermediate goods from the home country. This finding runs counter to the the popular view that the growing overseas activity of multinational enterprises could replace intermediate exports from a home country, thereby depriving the home country of job opportunities.

Keywords: Global production sharing; foreign direct investment; exports; automobile; Japan (search for similar items in EconPapers)
JEL-codes: F14 F23 (search for similar items in EconPapers)
Pages: 38
Date: 2012
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Global production sharing and the FDI–trade nexus: New evidence from the Japanese automobile industry (2013)
Working Paper: Global Production Sharing and FDI-Trade Nexus: New Evidence from the Japanese Automobile Industry (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:pas:papers:2012-13

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