TY  - JOUR
AU  - Markusen,James R.
AU  - Maskus,Keith E.
TI  - Discriminating Among Alternative Theories of the Multinational Enterprise
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7164
PY  - 1999
Y2  - June 1999
UR  - http://www.nber.org/papers/w7164
L1  - http://www.nber.org/papers/w7164.pdf
N1  - Author contact info:
James R. Markusen
Department of Economics
University of Colorado
Boulder, CO 80309-0256
Tel: 303/492-0748
Fax: 303/492-8960
E-Mail: james.markusen@colorado.edu
M1  - published as James R. Markusen, Keith E. Maskus. "Multinational Firms: Reconciling Theory and Evidence," in Magnus Blomstrom and Linda S. Goldberg, editors, "Topics in Empirical International Economics: A Festschrift in Honor of Robert E. Lipsey" University of Chicago Press (2001)

AB  - Recent theoretical developments have incorporated endogenous multinational firms into the general-equilibrium model of trade. One simple taxonomy separates the theory into  vertical' models in which firms geographically separate activities by stages of production and  horizontal' models of multi-plant firms which duplicate roughly the same activities in many countries.  We refer to a hybrid of these two as the 'knowledge capital model'. In this paper, we nest these three models within an unrestricted model.  Econometric tests give strong support to the horizontal model and overwhelming reject the vertical model.
ER  -