The Proximity-Concentration Trade-off with Multi-product Firms: Are Exports and FDI Complements or Substitutes?

Bricongne, Jean Charles; Franco-Bedoya, Sebastian; Forero, Margarita Lopez

doi:10.2139/ssrn.4219198

Cited by 1 publication

(3 citation statements)

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“…Third, firms may produce some products abroad and export others (Yeaple (2013a)). The latter fits well with evidence at the product level, where exports and FDI have been shown to constitute substitutes rather than complements (see, e.g., Blonigen (2001), Swenson (2004), Bricongne et al (2019)). In the following, we pursue this idea and develop a model to determine optimal modes of market access on the firmproduct level.…”

Section: Empirical Motivationsupporting

confidence: 86%

“…Tintelnot (2017) investigates the determinants of the location and production of multinational firms when foreign affiliates of multinationals may serve as export platforms. Using French firm-product level data, Bricongne et al (2019) analyze whether FDI and exports are complements or substitutes. They find that firms that do FDI export more, confirming the predominant result in the literature.…”

Section: Introductionmentioning

confidence: 99%

“…Their framework allows for adjustments at the firm-product extensive margin in response to trade policy changes. Using French firm-product-level data, Bricongne et al (2019) analyze whether FDI and exports are complements or substitutes. They find that firms that do FDI export more, confirming the predominant result in the literature.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Internationalization strategies of multi‐product firms: The role of technology

Baumgarten

Irlacher

Mayr‐Dorn

2022

Canadian J of Economics

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High-performance firms typically have two features in common: i) they produce in more than one country and ii) they produce more than one product. In this paper, we analyze the internationalization strategies of multi-product firms at the product-level. We find that the most productive firms sell core varieties via foreign direct investment (FDI) and export products with intermediate productivity. Shocks to trade costs and technology affect the endogenous decision to export or produce abroad at the product-level and, in turn, the relative productivity between parents and affiliates.

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