Effects of Overseas Production on Home Country Exports: Evidence Based on Swedish Multinationals
Weltwirtschaftliches Archiv, Vol. 132(2), pp. 304-29, 1996
23 Pages Posted: 16 Aug 2020 Last revised: 17 Aug 2020
Date Written: October 27, 1995
Using unique data on Swedish multinationals 1974-1990, the impacts of overseas production on parent exports are analyzed. Two methodological applications are introduced:
(i) In order to avoid sample selection bias, The model includes also countries to which the firm exports, but has not established any affiliates;
(ii) the effect of affiliate exports to "third countries" is incorporated.
The results suggest that increased foreign production both replaces exports of finished goods and attracts intermediate goods from the parent. In contrast to previous studies, the net effect is negative, albeit significant only in the case of affiliate exports in the EC.
Keywords: Overseas production, multinationals, exports, foreign direct investment
JEL Classification: F23
Suggested Citation: Suggested Citation