Mnes and Industrial Structure in Host Countries: A Mean Variance Analysis of Ireland's Manufacturing Sector

Journal of International Business Studies, Vol. 37, No. 3, pp. 392-406, 2006

IIIS Discussion Paper No. 23

37 Pages Posted: 3 Jun 2005 Last revised: 5 Jan 2011

See all articles by Frank Barry

Frank Barry

Trinity College (Dublin) - School of Business Studies

Colm Kearney

Monash University - Monash Business School

Date Written: June 1, 2004

Abstract

We use mean-variance analysis to demonstrate the importance of a hitherto neglected benefit of enticing MNEs to locate in small and medium-sized countries. During the 25 years from 1974 to 1999, over 1000 foreign MNEs have located in Ireland, and they have raised their share of all manufacturing jobs in the country from one-third to one-half. The foreign MNEs tend to operate in high-technology sectors, and they grow faster with greater volatility than the traditional low-technology indigenous firms. Because they are imperfectly correlated with the indigenous sectors, however, the foreign MNEs have helped to create a more completely diversified manufacturing sector in the host country that can grow faster without a commensurate rise in volatility and risk.

Keywords: FDI, MNEs, industrial structure, Ireland

Suggested Citation

Barry, Frank and Kearney, Colm, Mnes and Industrial Structure in Host Countries: A Mean Variance Analysis of Ireland's Manufacturing Sector (June 1, 2004). Journal of International Business Studies, Vol. 37, No. 3, pp. 392-406, 2006, IIIS Discussion Paper No. 23, Available at SSRN: https://ssrn.com/abstract=735124

Frank Barry

Trinity College (Dublin) - School of Business Studies ( email )

AAP College Green
Dublin 2
Ireland
353-1-896-2311 (Phone)

Colm Kearney (Contact Author)

Monash University - Monash Business School ( email )

Sir John Monash Drive
Caulfield
Melbourne, Victoria 3168
Australia
+353399031021 (Phone)

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
102
Abstract Views
958
rank
293,958
PlumX Metrics