The global networks of multinational firms
By: Laura Alfaro, Maggie Chen.
Contributors: Chen, Maggie.; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 15576; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 15576.
Publisher: National Bureau of Economic Research
Published: 2009
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "In this paper we characterize the topology of global multinational networks and examine the macro and micro patterns of multinational activity.  We construct indices of network density at both pairwise industry and establishment level and measure agglomeration in a global and continuous metric space.  These indices exhibit distinct advantages compared to traditional measures of agglomeration including the independence on the level of geographic aggregation.  Estimating the indices using a new worldwide establishment dataset, we investigate both the significance and causes of multinational firm co-agglomeration.  In contrast to the conventional emphasis of the literature on the role of input-output linkages, we assess the effect of various agglomeration economies.  We find that, relative to counterfactuals, multinationals with greater factor-market externalities, knowledge spillovers, and vertical linkages exhibit significant co-agglomeration.  The importance of these factors differs across headquarters, subsidiary, and employment networks, but knowledge spillovers and capital-market externalities, two traditionally under-emphasized forces, exert consistently strong effects.  Within each macro network, there is a large heterogeneity across subsidiaries.  Subsidiaries with greater size and higher productivity attract significantly more agglomeration than their counterfactuals and become the hubs of the network"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 12/28/2009.

Includes bibliographical references.

Also available in print.

System requirements: Adobe Acrobat Reader.

Mode of access: World Wide Web.