Dissecting FDI

Joern Kleinert () and Farid Toubal

No 2006-7, CEI Working Paper Series from Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University

Abstract: This paper investigates the importance of firm heterogeneity for our understanding of the aggregate volume of cross-country multinational sales. Recent theoretical literature points out a sorting out firms with respect to their internationalization strategy according to their productivity. Using the firm level data from German firms' activities, we find a strong effect of firms' size on internationalization pattern. Moreover, we show that most of variation of the aggregate volume of multinational sales is due to variation in the number of firms participating in the market.

Keywords: Gravity equation; multinational firms; heterogeneity (search for similar items in EconPapers)
JEL-codes: C21 F12 F23 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2006-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:hit:hitcei:2006-7

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