Firm Growth in Multinational Corporate Groups

Harald Oberhofer and Michael Pfaffermayr

No 2010-7, Working Papers in Economics from University of Salzburg

Abstract: This paper formulates an econometric firm growth model that explicitly accounts for interdependence of growth performance within multinational corporate networks. We apply a recently introduced IV-estimation procedure for peer group effects to directly test for externalities within multinational corporate networks. Using European firm level data, our results reveal positive externalities within vertically organized multinational networks, while they are negative for horizontally organized ones. In the former case, multinational corporate groups are more stable and adjust faster on average. In the latter case, externalities lead to more heterogeneity in the firm growth processes within the network and slower average size adjustment.

Keywords: Firm growth; Size Adjustment; Multinational Corporate Groups; Peer Group Effect Estimation (search for similar items in EconPapers)
JEL-codes: C21 F23 L23 L25 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2010-03-04
New Economics Papers: this item is included in nep-cse
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Related works:
Journal Article: Firm growth in multinational corporate groups (2013)
Working Paper: Firm Growth in Multinational Corporate Groups
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Persistent link: https://EconPapers.repec.org/RePEc:ris:sbgwpe:2010_007

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