Foreign Direct Investment in Europe

Explaining Manufacturing and Non‐Manufacturing Inbound FDI Location in Five UK Regions

“…National market conditions, as well as the size of the EU's Single Market may thus influence the inflow of market seeking, manufacturing and non‐manufacturing FDI into the UK's core and non‐core regions (Liebscher et al . ). It may also be attracted into both sectors and both types of region by the presence or absence of a critical mass of existing, manufacturing or non‐manufacturing FDI (Gorg & Ruane ; Henisz & Delios ).…”

“…Regional and national factors can be expected to impact on the cost efficiency of core and non‐core regions for inbound FDI purposes (Liebscher et al . ). Labour market strengths, relating to an abundant labour supply, low costs, high levels of education, training and productivity and a low propensity to strike are all likely to attract efficiency seeking FDI inflows into both sectors and types of region (Schneider & Frey ; Hill & Munday , ; Yeung & Strange ).…”

“…These factors are likely, in turn to be influenced by prevailing demographic, economic, market and industrial conditions at the international, national and regional levels, as well as by the FDI‐related policy decisions taken by governments (Liebscher et al . ; UKTI , ). TNCs often respond to economic development by locating relatively large amounts of inbound FDI in core regions (such as Southeast England) (Kottaridi ; Dunning ; Pearce ; Rowthorn ).…”

The determinants of services FDI location in the UK regions

“…The strategic determinants and specific motives that drive the location of services sector FDI depend on the competitiveness of individual regions in terms of market conditions, productive efficiency, and the availability of strategic assets such as knowhow and technology (Dunning, 2006;Richelieu, 2008). These factors are influenced by the economic conditions that prevail at the EU, national and regional levels, as well as by governments' inward investment policy decisions (Liebscher et al 2007;UKTI 2011aUKTI , 2011b. MNEs often respond to higher levels of economic development by locating relatively large amounts of inbound FDI in core regions (such as Southeast England) (Kottaridi, 2005;Dunning 2006;Pearce 2006;Rowthorn 2010).…”

“…Market-seeking FDI is often the main determinant of inbound FDI location in the services sector for core and non-core regions alike (Driffield and Munday 2000;Loewendahl 2001a;Riedl, 2010). EU Single Market access, as well as the state of the UK's national market may be expected to influence the inflow of market seeking, services FDI into the UK's regions (Liebscher et al 2007). This may be drawn more heavily to core regions owing to their higher population density and per capita income levels, their larger market size and better long-term growth prospects (Dunning 1981;Wheeler and Moody 1992;Billington, 1999).…”