The Evolution of International Business Enterprise

This paper outlines the development of international firms over the period from 1870 to 1945. It shows how British and other European trading firms developed international investment operations using the medium of free-standing companies. This was the origin of Royal Dutch Shell amongst other firms. It then considers the emergence of international Foreign Direct Investment that was stimulated by the developments of the Second Industrial Revolution in the latter years of the nineteenth century. The production of standardised products using system of mass production, and the scientific breakthroughs in chemistry and electrical engineering, amongst others, brought to the fore international firms such as Siemens and General Electric, Singer, British American Tobacco and Ford. The growth of these enterprises suffered a setback during the First World War from which German firms were slow to recover. The Great Depression that followed the US stock market crash in 1929 brought the first era of globalisation to an end. The work of Alfred D. Chandler and Geoffrey Jones in explaining the development of international companies is given particular attention

Foreign Direct Investments, Regional Incentives and Regional Attractiveness in Greece

The aim of this paper is to analyze the Foreign Direct Investment (FDI) activity in Greece. The paper starts with defining the main FDI terms and giving a general literature review corresponding to the FDI allocation. Then, there is a description of recent trends in FDI activity both worldwide and Greece. Especially FDI investments in Greece are analyzed presenting the magnitudes of inflows, outflows, inward stock, outward stock, as well as foreign mergers and acquisitions, in terms of sales and purchases. The second part of the paper describes the regional and sectoral allocation of FDI in Greece, emphasizing whether the investment incentive scheme contributes to the attraction of FDI in specific regions, or the growth rate of each region is the main motive for locating foreign investment capital. The analysis is based on the most recent statistical data covering magnitudes until 2002.

Foreign ownership and productivity: new evidence from the service sector and the R&D lab

This paper examines the relationship between foreign ownership and productivity, paying particular attention to two issues neglected in the existing literature – the role of multinationals in service sectors and the importance of R&D activity conducted by foreign multinationals. We review existing theoretical and empirical work, which largely focuses on manufacturing, before presenting new evidence using establishment level data on production, service and R&D activity for the United Kingdom. We find that multinationals play an important role in service sectors and that entry of foreign multinationals by takeover is more prevalent than greenfield investment. We find that British multinationals have lower levels of labour productivity than foreign multinationals, but the difference is less stark in the service sector than in the production sector, and that British multinationals have lower levels of investment and intermediate use per employee. We also find that foreign-owned multinationals conduct a substantial amount of UK R&D. We discuss the implications of these and other findings for the policy debate on incentives to influence multinational firms’ location choices