Networked FDI: Sales and Sourcing Patterns of Japanese Foreign Affiliates

Richard Baldwin and Toshihiro Okubo ()

No 8963, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Using firm-level data on the sales and sourcing patterns of Japanese affiliates, this paper suggests that very little FDI falls neatly into the standard bins of horizontal, vertical and export-platform FDI. Most affiliates import some intermediates and export some output suggesting a pattern that might be called ‘networked FDI’. This suggests that that the nature of FDI is influenced by ‘regional comparative advantage’ i.e. the proximity of markets and suppliers. The paper also suggests an empirical strategy for testing and classifying the nature of FDI based on firms’ sales and sourcing patterns rather than standard macro-level variables such as market size and income differences.

Keywords: complex FDI; Japanese foreign affiliates; networked FDI; sales; sourcing; vertical and horizontal FDI (search for similar items in EconPapers)
JEL-codes: F21 F23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-int
Date: 2012-05
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Related works:
Working Paper: Networked FDI: Sales and sourcing patterns of Japanese foreign affiliates (2012)
Working Paper: Networked FDI: Sales and Sourcing Patterns of Japanese Foreign Affiliates (2012)
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