Firm Size and Foreign Direct Investment

14 Pages Posted: 25 Aug 2000 Last revised: 21 Sep 2010

See all articles by Magnus Blomstrom

Magnus Blomstrom

Stockholm School of Economics - Department of Economics; National Bureau of Economic Research (NBER), at New York; Centre for Economic Policy Research (CEPR)

Robert E. Lipsey

National Bureau of Economic Research (NBER) at New York (Deceased)

Date Written: December 1986

Abstract

This paper examines the importance of firm size in explaining foreign direct investment with data from American and Swedish firms. The results suggest that firm size only has a threshold effect on foreign investment, an effect on the decision to invest abroad. Once, however, a firm has jumped the initial barriers to foreign production, size has no effect on the fraction of the firm's resources devoted to foreign activity. Among firms that invest in foreign production large firms do not appear to have any particular advantage over small investing firms.

Suggested Citation

Blomstrom, Magnus and Lipsey, Robert E., Firm Size and Foreign Direct Investment (December 1986). NBER Working Paper No. w2092. Available at SSRN: https://ssrn.com/abstract=240080

Magnus Blomstrom (Contact Author)

Stockholm School of Economics - Department of Economics ( email )

P.O. Box 6501
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S-113 83 Stockholm
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+46 8 736 9265 (Phone)
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National Bureau of Economic Research (NBER), at New York

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Centre for Economic Policy Research (CEPR)

London
United Kingdom

Robert E. Lipsey

National Bureau of Economic Research (NBER) at New York (Deceased)

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