Agglomeration, backward and forward linkages: evidence from South Korean investment in China

Peter Debaere, Joonhyung Lee and Myungho Paik

Canadian Journal of Economics, 2010, vol. 43, issue 2, 520-546

Abstract: With a firm-level data set, we study the location decision of South Korean multinationals across China's regions. Our conditional logit estimates confirm agglomeration effects along industry and along national lines. We add an upstream and downstream (backward and forward) linkage effect. We find that the presence of upstream and downstream South Korean affiliates significantly increases the likelihood that a South Korean multinational invests in a particular region. However, linkages that do not differentiate by nationality do not seem to matter much. As such, our analysis of investors' location choice brings together two perspectives: linkages and agglomeration along national lines.

JEL-codes: F21 F23 R12 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (34)

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Working Paper: Agglomeration, Backward and Forward Linkages: Evidence from South Korean Investment in China (2008)
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