Subsidy competition and the mode of FDI

Facundo Albornoz; Gregory Corcos; Toby Kendall

doi:10.1016/j.regsciurbeco.2009.02.002

Subsidy competition and the mode of FDI

Facundo Albornoz
, Gregory Corcos
, Toby Kendall

University of Birmingham
Norwegian School of Economics and Business Administration

Résultats de recherche: Contribution à un journal › Article › Revue par des pairs

9 Citations (Scopus)

Résumé

We model subsidy competition for a foreign MNC's investment in two trading partners. Taking into account acquisitions as an alternative investment mode weakens the case for subsidising greenfield investment. Competition between countries results in welfare losses, which are reinforced by positive externalities from the MNC's presence and regional integration. The results also apply to situations where the acquisition price accounts for the possibility of subsidies and when governments use acquisition subsidies as an alternative to greenfield subsidies.

langue originale	Anglais
Pages (de - à)	489-501
Nombre de pages	13
journal	Regional Science and Urban Economics
Volume	39
Numéro de publication	4
Les DOIs	https://doi.org/10.1016/j.regsciurbeco.2009.02.002
état	Publié - 1 juil. 2009
Modification externe	Oui

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10.1016/j.regsciurbeco.2009.02.002

Contient cette citation

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title = "Subsidy competition and the mode of FDI",

abstract = "We model subsidy competition for a foreign MNC's investment in two trading partners. Taking into account acquisitions as an alternative investment mode weakens the case for subsidising greenfield investment. Competition between countries results in welfare losses, which are reinforced by positive externalities from the MNC's presence and regional integration. The results also apply to situations where the acquisition price accounts for the possibility of subsidies and when governments use acquisition subsidies as an alternative to greenfield subsidies.",

keywords = "FDI, Greenfield investment, Mergers and acquisitions, Positive externalities, Regional integration, Subsidy competition",

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AU - Corcos, Gregory

AU - Kendall, Toby

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N2 - We model subsidy competition for a foreign MNC's investment in two trading partners. Taking into account acquisitions as an alternative investment mode weakens the case for subsidising greenfield investment. Competition between countries results in welfare losses, which are reinforced by positive externalities from the MNC's presence and regional integration. The results also apply to situations where the acquisition price accounts for the possibility of subsidies and when governments use acquisition subsidies as an alternative to greenfield subsidies.

AB - We model subsidy competition for a foreign MNC's investment in two trading partners. Taking into account acquisitions as an alternative investment mode weakens the case for subsidising greenfield investment. Competition between countries results in welfare losses, which are reinforced by positive externalities from the MNC's presence and regional integration. The results also apply to situations where the acquisition price accounts for the possibility of subsidies and when governments use acquisition subsidies as an alternative to greenfield subsidies.

KW - FDI

KW - Greenfield investment

KW - Mergers and acquisitions

KW - Positive externalities

KW - Regional integration

KW - Subsidy competition

U2 - 10.1016/j.regsciurbeco.2009.02.002

DO - 10.1016/j.regsciurbeco.2009.02.002

M3 - Article

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VL - 39

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JO - Regional Science and Urban Economics

JF - Regional Science and Urban Economics

IS - 4

ER -

Subsidy competition and the mode of FDI

Résumé

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