Firm Heterogeneity and the Structure of U.S. Multinational Activity: An Empirical Analysis

No 14072, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use firm-level data for U.S. multinational enterprises (MNE) and the model of firm heterogeneity first presented in Helpman, Melitz, and Yeaple (2004) to make four empirical contributions. First, we show that the most productive U.S. firms invest in a larger number of foreign countries and sell more in each country in which they operate. Second, we assess the importance of firm heterogeneity in the structure of MNE activity. Third, we use the model to identify the mechanisms through which country characteristics affect the structure of MNE activity. Finally, we provide a systematic assessment of the model's shortcomings in order to inform the development of new theory.

JEL-codes: F1 F23 (search for similar items in EconPapers)
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Date: Written 2008-06
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