TY  - JOUR
AU  - Grossman,Gene M.
AU  - Helpman,Elhanan
AU  - Szeidl,Adam
TI  - Optimal Integration Strategies for the Multinational Firm
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 10189
PY  - 2003
Y2  - December 2003
UR  - http://www.nber.org/papers/w10189
L1  - http://www.nber.org/papers/w10189.pdf
N1  - Author contact info:
Gene M. Grossman
International Economics Section
Department of Economics
Princeton University
Princeton, NJ 08544
Tel: 609/258-4823
Fax: 609/258-1374
E-Mail: grossman@princeton.edu

Elhanan Helpman
Department of Economics
Harvard University
1875 Cambridge Street
Cambridge, MA 02138
Tel: 617-495-4690
Fax: 617-495-7730
E-Mail: ehelpman@harvard.edu

Adam Szeidl
Department of Economics
University of California, Berkeley
517 Evans Hall #3880
Berkeley, CA 94720-3880
Tel: 510/642-2603
Fax: 510/642-6615
E-Mail: szeidl@econ.berkeley.edu
AB  - We examine integration strategies of multinational firms that face a rich array of choices of international organization. Each firm in an industry must provide headquarter services from its home country, produce intermediate inputs, and assemble the intermediate goods into final products. Both production of intermediate goods and assembly can be performed at home, in another  Northern' country, in the low-wage  South,' or in several of these locations. We study the equilibrium choices of firms that differ in productivity (and thus size), focusing on the role of industry characteristics such as the fixed costs of foreign subsidiaries, the cost of transporting intermediate and final goods, and the share of the consumer market that resides in the South in determining optimal integration strategies.
ER  -