Does Foreign Direct Investment Replace Home Country Investment? The Effect of European Integration on the Location of Swedish Investment

Pontus Braunerhjelm and Lars Oxelheim

Journal of Common Market Studies, 2000, vol. 38, issue 2, 199-221

Abstract: The purpose of this article is to examine the effects of European integration on the location of investments by Swedish multinational corporations (MNCs). Evidence is presented about the extent to which European integration has attracted investment by Swedish MNCs, and whether foreign direct investment (FDI) is being undertaken at the expense of home country investment. In the empirical analysis, involving both OLS and iterative SUR techniques, a significant difference across industries has been confirmed. A substitutionary relationship between foreign and home country investment is found for more R&D‐intensive production, whereas the opposite pattern seems to prevail for production based on traditional comparative advantage. The results of this study emphasize the importance of using disaggregated industry‐level data when analysing the effects of foreign direct investment on home country investment.

Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
https://doi.org/10.1111/1468-5965.00217

Related works:
Working Paper: Does Foreign Direct Investment Replace Home Country Investment? The Effect of European Integration on the Location of Swedish Investment (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jcmkts:v:38:y:2000:i:2:p:199-221

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0021-9886

Access Statistics for this article

Journal of Common Market Studies is currently edited by Jim Rollo and Daniel Wincott

More articles in Journal of Common Market Studies from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().