Multinational Investment: Incentives and Effects
Joosung Jun
Governance Research Series 1, Ewha Womans University Press, 2003
The growing importance of multinational activities worldwide has led to a policy concern about the ways that international investment responds to incentives and affects the host economy. Firms invest abroad since overseas activities add to their value. Because of the inherent disadvantages and higher costs of foreign production, the multinational firm must possess some special advantage which is not available to domestic firms. Such advantage ranges from superior production or marketing skills to lower costs due to scale economies or tax-related opportunities. On the part of the host government, a proper understanding of the reasons for foreign investment and its economic effects will be essential in designing the related policies.
The studies presented in this volume analyze the interaction of various incentives available in the host economy and the investment decisions by multinational enterprises. Each study deals with a specific subject related to the multinational behavior and its impact on the host economy: the value of being a multinational, determinants of foreign direct investment, tax incentives for the location choice of investment and technology activities, the impact of local tax incentives for inward foreign investment, and the implications on trade pattern of multinational investment.
Contents
1.The Value of Multinationality: Alternative Explanations
2. Determinants of Multinational Investment: The Case of Japanese Firms
3. Tax Incentives for Investment Technology Transfer
4. Tax Effects on Foreign Direct Investment: A Regression Analysis
5. Foreign Direct Investment and Host Country Trade: The Case of Japanese Operations in the United States
Multinational Investment: Incentives and Effects
Joosung Jun
Governance Research Series 1, Ewha Womans University Press, 2003
The growing importance of multinational activities worldwide has led to a policy concern about the ways that international investment responds to incentives and affects the host economy. Firms invest abroad since overseas activities add to their value. Because of the inherent disadvantages and higher costs of foreign production, the multinational firm must possess some special advantage which is not available to domestic firms. Such advantage ranges from superior production or marketing skills to lower costs due to scale economies or tax-related opportunities. On the part of the host government, a proper understanding of the reasons for foreign investment and its economic effects will be essential in designing the related policies.
The studies presented in this volume analyze the interaction of various incentives available in the host economy and the investment decisions by multinational enterprises. Each study deals with a specific subject related to the multinational behavior and its impact on the host economy: the value of being a multinational, determinants of foreign direct investment, tax incentives for the location choice of investment and technology activities, the impact of local tax incentives for inward foreign investment, and the implications on trade pattern of multinational investment.
Contents
1.The Value of Multinationality: Alternative Explanations
2. Determinants of Multinational Investment: The Case of Japanese Firms
3. Tax Incentives for Investment Technology Transfer
4. Tax Effects on Foreign Direct Investment: A Regression Analysis
5. Foreign Direct Investment and Host Country Trade: The Case of Japanese Operations in the United States