TY  - JOUR
AU  - Baldwin,Richard E.
AU  - Ottaviano,Gianmarco I. P.
TI  - Multiproduct Multinationals and Reciprocal FDI Dumping
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6483
PY  - 1998
Y2  - March 1998
UR  - http://www.nber.org/papers/w6483
L1  - http://www.nber.org/papers/w6483.pdf
N1  - Author contact info:
Richard Baldwin
Cigale 2
1010 Lausanne
SWITZERLAND
Tel: 41-22-908-5900
E-Mail: rbaldwin@cepr.org
AB  - The global pattern of foreign direct investment (FDI) is quite similar to the world trade pattern.  In particular, intraindustry FDI between rich nations is almost as pervasive as intraindustry trade among rich nations.  In the  standard' MNC model (of Markusen, Venables, Brainard, and others), FDI is driven by a tradeoff between proximity and scale, so firms typically supply the foreign market via exports or via FDI.  The close correlation of two-way trade and investment flows is therefore difficult to explain with the standard model. We propose a model of multiproduct MNCs where firms simultaneously engage in intraindustry FDI and intraindustry trade.
ER  -