The global agglomeration of multinational firms
By: Laura Alfaro, Maggie Xiaoyang Chen
Contributors: Chen, Maggie Xiaoyang, author; Harvard Business School
Edition: Revised edition
Series: Working paper / Harvard Business School -- 10-043; Working paper (Harvard Business School) -- 10-043.
Publisher: Harvard Business School
Published: 2014
Place of publication: Boston]
Language: eng
Number of pages: 57
Work titles: Global networks of multinational firms
Description: The explosion of multinational activities in recent decades is rapidly transforming the global landscape of industrial production. But are the emerging clusters of multinational production the rule or the exception? What drives the offshore agglomeration of multinational firms in comparison to the agglomeration of domestic firms? Using a unique worldwide plant-level dataset that reports detailed location, ownership, and operation information for plants in over 100 countries, we construct a spatially continuous index of pairwise-industry agglomeration and investigate the patterns and determinants underlying the global economic geography of multinational firms. Our analysis presents new stylized facts that suggest the emerging offshore clusters of multinationals are not a simple reflection of domestic industrial clusters. Agglomeration economies including capital-good market externality and technology diffusion play a more important role in the offshore agglomeration of multinationals than the agglomeration of domestic firms. These findings remain robust when we address potential reverse causality by exploring the regional pattern and process of agglomeration.
Notes: "December 2009. (Revised April 2014.)"--Publisher's Web site.

Revised edition of The global networks of multinational firms, originally published in [2009].

Includes bibliographical references (pages 35-39).