Determinants of Foreign Direct Investment in the Food-Processing Industry: A Comparative Analysis of Developed and Developing Economies

Shiva S. Makki, Agapi Somwaru and H. Christine Bolling

Journal of Food Distribution Research, 2004, vol. 35, issue 3, 8

Abstract: This paper analyzes the determinants of foreign direct investments by the U.S. food-processing industry in developed and developing countries. We find that market size, per-capita income, and trade openness significantly affect U.S. food-processing firms' decisions to invest abroad, but their influence differs between developed and developing countries. Economic development is positively associated with FDI in developing countries but negatively associated in developed countries. Market size is a major determinant of FDI only in developed economies. Trade openness seems to be important for sales by U.S. foreign affiliates in both developed and developing countries and for exports to developed country markets.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlofdr:27558

DOI: 10.22004/ag.econ.27558

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