Strategic investments and multinational firms under oligopoly

José J. Sempere Monerris (), Rafael Moner Colonques () and Vicente Orts Ríos
Additional contact information
José J. Sempere Monerris: Universitat de València
Rafael Moner Colonques: Universitat de València
Vicente Orts Ríos: Universitat Jaume I
Authors registered in the RePEc Author Service: José J. Sempere-Monerris

Working Papers. Serie EC from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: We have developed a simple oligopoly model in which foreign direct investment (FDI) decisions are determined in an endogenous fashion. There is a host oligopoly facing competition from a foreign oligopoly in the form of either foreign investment or exports. Then, we propose a multi-stage game to stress the role played by the interactions among foreign rival firms´ decisions, and we identify some of the determinants of a switch from an exporting strategy to an FDI strategy. A delay in the investment is more likely found for big enough country-specific fixed costs and low values of the oligopoly profitability. Our model provides a theoretical basis which leads to predictions in line with previous empirical studies.

JEL-codes: F12 F23 (search for similar items in EconPapers)
Pages: 17 pages
Date: 1997-01
References: Add references at CitEc
Citations:

Published by Ivie

Downloads: (external link)
http://www.ivie.es/downloads/docs/wpasec/wpasec-1997-16.pdf Fisrt version / Primera version, 1997 (application/pdf)

Related works:
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:ivi:wpasec:1997-16

Access Statistics for this paper

More papers in Working Papers. Serie EC from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) Contact information at EDIRC.
Bibliographic data for series maintained by Departamento de Edición ().