London School of Economics
London, WC2A 2AE, U.K
NBER Working Papers and Publications
|April 2009||Plant-Size Distribution and Cross-Country Income Differences|
with Laura Alfaro, Fabio Kanczuk
in NBER International Seminar on Macroeconomics 2008, Jeffrey Frankel and Christopher Pissarides, organizers
|June 2008||Plant-Size Distribution and Cross-Country Income Differences|
with Laura Alfaro, Fabio Kanczuk: w14060
We investigate, using plant-level data for 79 developed and developing countries, whether differences in the allocation of resources across heterogeneous plants are a significant determinant of cross-country differences in income per worker. For this purpose, we use a standard version of the neoclassical growth model augmented to incorporate monopolistic competition among heterogeneous plants. For our preferred calibration, the model explains 58% of the log variance of income per worker. This figure should be compared to the 42% success rate of the usual model.
|September 2007||Intra-Industry Foreign Direct Investment|
with Laura Alfaro: w13447
We use a new firm level data set that establishes the location, ownership, and activity of 650,000 multinational subsidiaries -- close to a comprehensive picture of global multinational activity. A number of patterns emerge from the data. Most foreign direct investment (FDI) occurs between rich countries. The share of vertical FDI (subsidiaries which provide inputs to their parent firms) is larger than commonly thought, even within developed countries. More than half of all vertical subsidiaries are only observable at the four-digit level because the inputs they are supplying are so proximate to their parent firms' final good that they appear identical at the two-digit level. We call these proximate subsidiaries 'intra-industry' vertical FDI and find that their location and activity are si...
Published: Alfaro, Laura and Andrew Charlton. "Intra-industry Foreign Direct Investment." American Economic Review 99, 5 (2009): 2096-2119. citation courtesy of
|May 2007||International Financial Integration and Entrepreneurial Firm Activity|
with Laura Alfaro: w13118
We explore the relation between international financial integration and the level of entrepreneurial activity in a country. We use a unique firm level data set of approximately 24 million firms in nearly 100 countries in 2004 and 1999, which enables us to present both cross-country and industry level evidence. We establish robust cross-country correlations between increased international financial integration and the activity of entrepreneurs using various proxies for entrepreneurial activity such as entry, size, and skewness of the firm-size distribution and de jure and de facto measures of international capital integration. We then explore causal channels through which foreign capital may encourage entrepreneurship. We find evidence that entrepreneurial activity in industries which are m...