Past Interactions and New Foreign Direct Investment Location Decisions

Elizabeth L. Rose () and Kiyohiko Ito
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Elizabeth L. Rose: Helsinki School of Economics
Kiyohiko Ito: University of Hawai’i at Manoa

Management International Review, 2009, vol. 49, issue 5, No 5, 669 pages

Abstract: Abstract Analyzing the nature of competitive interaction among multinational firms in the tire industry, we find that the histories of the interactions between particular rivals matter. The decision to enter a new foreign market in the era of global consolidation is related to the identities of rivals in the market, characteristics of the firm and the market, and the extent of past competitive interactions with the international pioneering firm. Results suggest that, in an oligopolistic environment, aspects of multimarket competition are important to foreign direct investment decisions.

Keywords: Oligopolistic reaction; Firm-specific interactions; Multimarket competition; Pioneer vs. late-mover; FDI (search for similar items in EconPapers)
Date: 2009
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DOI: 10.1007/s11575-009-0010-y

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