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

Peter Debaere, Joonhyung Lee and Myungho Paik

Canadian Journal of Economics/Revue canadienne d'économique, 2010, vol. 43, issue 2, 520-546

Abstract: 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. A partir d'une base de données au niveau de l'entreprise, on étudie la localisation de firmes plurinationales sud‐coréennes dans les régions de la Chine. Les résultats d'une analyse de type logit confirment qu'il existe des effets d'agglomération tant dans l'axe industriel que national. Quand on ajoute les effets en amont et en aval, on découvre que la présence d'affiliés sud‐coréens en amont et en aval accroît de manière significative la probabilité qu'une firme plurinationale sud‐coréenne investisse dans une région particulière. Cependant les liens qui ne discriminent pas selon l'axe de la nationalité ne semblent pas avoir grande importance. L'analyse des décisions de localisation d'investissement synthétise deux perspectives : liens et agglomération selon l'axe de la nationalité.

Date: 2010
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Citations: View citations in EconPapers (16)

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https://doi.org/10.1111/j.1540-5982.2010.01582.x

Related works:
Journal Article: Agglomeration, backward and forward linkages: evidence from South Korean investment in China (2010)
Working Paper: Agglomeration, Backward and Forward Linkages: Evidence from South Korean Investment in China (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:wly:canjec:v:43:y:2010:i:2:p:520-546

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