How Far Away is an Intangible? Services FDI and Distance

26 Pages Posted: 6 Oct 2011

See all articles by Ronald B. Davies

Ronald B. Davies

University College Dublin (UCD)

Amélie Guillin

Paris School of Economics (PSE); Johannes Kepler University Linz

Multiple version iconThere are 2 versions of this paper

Date Written: September 30, 2011


Foreign direct investment (FDI) in services has grown significantly in recent years. Evidence of spatial relationships in FDI decisions have been provided for goods manufacturing by utilizing physical distance-based measures of trade costs. This paper investigates spatial interactions for services FDI using several distance measures, including physical distance, genetic distance, and transport time. Across different measures of distance, the traditional determinants of outbound FDI activity remain valid for services. We also find spatial interdependence for services FDI that is generally supportive of complex vertical motivations.

Keywords: foreign direct investment, services, spatial econometric techniques

JEL Classification: F210, F230

Suggested Citation

Davies, Ronald B. and Guillin, Amélie, How Far Away is an Intangible? Services FDI and Distance (September 30, 2011). CESifo Working Paper Series No. 3599, Available at SSRN: or

Ronald B. Davies

University College Dublin (UCD) ( email )

Belfield, Dublin 4 4

Amélie Guillin (Contact Author)

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014

Johannes Kepler University Linz ( email )

Altenbergerstr. 69
A-4040 Linz, Uper Austria 4040


Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics