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Article: FDI policy, greenfield investment and cross-border mergers
Title | FDI policy, greenfield investment and cross-border mergers |
---|---|
Authors | |
Keywords | Competition (economics) Developing world Economic policy Foreign direct investment Merger |
Issue Date | 2011 |
Publisher | Blackwell Publishing Ltd. The Journal's web site is located at http://www.blackwellpublishing.com/journal.asp?ref=0965-7576&site=1 |
Citation | Review Of International Economics, 2011, v. 19 n. 5, p. 836-851 How to Cite? |
Abstract | This paper examines a multinational's choice between greenfield investment and cross-border merger when it enters another country via foreign direct investment (FDI) and faces the host country's FDI policy. Greenfield investment incurs a fixed plant setup cost, whereas the foreign firm obtains only a share of the joint profit from a cross-border merger under the restriction of the FDI policy. This trade-off is affected by market demand, cost differential, and market competition, among other things. The host country's government chooses its FDI policy to affect (or alter) the multinational's entry mode to achieve the maximum social welfare for the domestic country. We characterize the conditions shaping the optimal FDI policy and offer intuitions on FDI patterns in developing and developed countries. © 2011 Blackwell Publishing Ltd. |
Persistent Identifier | http://hdl.handle.net/10722/164729 |
ISSN | 2023 Impact Factor: 1.0 2023 SCImago Journal Rankings: 0.593 |
SSRN | |
ISI Accession Number ID | |
References |
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Qiu, LD | en_HK |
dc.contributor.author | Wang, S | en_HK |
dc.date.accessioned | 2012-09-20T08:08:44Z | - |
dc.date.available | 2012-09-20T08:08:44Z | - |
dc.date.issued | 2011 | en_HK |
dc.identifier.citation | Review Of International Economics, 2011, v. 19 n. 5, p. 836-851 | en_HK |
dc.identifier.issn | 0965-7576 | en_HK |
dc.identifier.uri | http://hdl.handle.net/10722/164729 | - |
dc.description.abstract | This paper examines a multinational's choice between greenfield investment and cross-border merger when it enters another country via foreign direct investment (FDI) and faces the host country's FDI policy. Greenfield investment incurs a fixed plant setup cost, whereas the foreign firm obtains only a share of the joint profit from a cross-border merger under the restriction of the FDI policy. This trade-off is affected by market demand, cost differential, and market competition, among other things. The host country's government chooses its FDI policy to affect (or alter) the multinational's entry mode to achieve the maximum social welfare for the domestic country. We characterize the conditions shaping the optimal FDI policy and offer intuitions on FDI patterns in developing and developed countries. © 2011 Blackwell Publishing Ltd. | en_HK |
dc.language | eng | en_US |
dc.publisher | Blackwell Publishing Ltd. The Journal's web site is located at http://www.blackwellpublishing.com/journal.asp?ref=0965-7576&site=1 | en_HK |
dc.relation.ispartof | Review of International Economics | en_HK |
dc.rights | The definitive version is available at www.blackwell-synergy.com | - |
dc.subject | Competition (economics) | - |
dc.subject | Developing world | - |
dc.subject | Economic policy | - |
dc.subject | Foreign direct investment | - |
dc.subject | Merger | - |
dc.title | FDI policy, greenfield investment and cross-border mergers | en_HK |
dc.type | Article | en_HK |
dc.identifier.email | Qiu, LD: larryqiu@hku.hk | en_HK |
dc.identifier.authority | Qiu, LD=rp01093 | en_HK |
dc.description.nature | link_to_subscribed_fulltext | - |
dc.identifier.doi | 10.1111/j.1467-9396.2011.00984.x | en_HK |
dc.identifier.scopus | eid_2-s2.0-80054710540 | en_HK |
dc.identifier.hkuros | 209926 | en_US |
dc.identifier.hkuros | 207601 | - |
dc.relation.references | http://www.scopus.com/mlt/select.url?eid=2-s2.0-80054710540&selection=ref&src=s&origin=recordpage | en_HK |
dc.identifier.volume | 19 | en_HK |
dc.identifier.issue | 5 | en_HK |
dc.identifier.spage | 836 | en_HK |
dc.identifier.epage | 851 | en_HK |
dc.identifier.isi | WOS:000296027300004 | - |
dc.publisher.place | United Kingdom | en_HK |
dc.identifier.ssrn | 1945584 | - |
dc.identifier.scopusauthorid | Qiu, LD=7201538008 | en_HK |
dc.identifier.scopusauthorid | Wang, S=53664836700 | en_HK |
dc.identifier.issnl | 0965-7576 | - |