Reversing the Perspective: Multinational Activity from Middle-Income Countries

The organization of production within the multinational corporation (MNC) depends on the relative factor abundance of the home country and the destination country. This proposition is at the heart of the theory of the multinational corporation (MNCs) that Helpman (1984, 1985) and Helpman and Krugman (1985) developed and that is primarily conceived from the perspective of the advanced, developed countries. It rationalizes one-way, North-South MNC activity; MNCs from capital-abundant nations break up domestic production and relocate the labor-intensive parts to low-wage countries. I show how two-way MNC activities are implied by the theory that Helpman and Krugman develop and how these are essential to understand MNCs from middle-income countries: these MNCs relocate labor-intensive activities to more labor-abundant countries, they also move capital-intensive components to more capital-abundant countries. I use unique South Korean firm-level data to investigate this hypothesis. I provide evidence from the affiliates of South Korea�s MNCs that bears out this prediction. I also formally test the implications of the hypothesis for the parents� capital-intensity with a panel of South Korean MNC parents (1980-1996). Relocating to more capital-abundant countries indeed decreases the parent�s capital-labor ratio, whereas relocating to more labor-abundant countries increase this ratio.multinationals

Greasing the Wheels of International Commerce: How Services Facilitate Firms' International Sourcing

We use unique plant-level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. To guide our empirical analysis we develop a monopolistic-competition model of the materials sourcing decisions of heterogeneous firms. The model generates predictions about how the intensity of international sourcing of materials depends on a firm’s productivity and the availability of local services. These predictions are supported by the data. We find evidence that more productive manufacturing firms tend to have a higher ratio of imported materials to sales. In addition, we find evidence that services grease the wheels of international commerce: A greater availability of services across regions, industries and time increases a firm’s foreign sourcing of materials relative to sales. Interestingly, this positive impact of local service availability on imports especially applies to stand-alone firms that, unlike multinationals, are less likely to rely on imported or internally provided services.international trade, services, off-shoring, supply chain management, firm heterogeneity

Greasing the wheels of international commerce: how services facilitate firms' international sourcing.

We use unique plant-level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. To guide our empirical analysis we develop a monopolistic-competition model of the materials sourcing decisions of heterogeneous firms. The model generates predictions about how the intensity of international sourcing of materials depends on a firm's productivity and the availability of local services. These predictions are supported by the data. We find evidence that more productive manufacturing firms tend to have a higher ratio of imported materials to sales. In addition, we find evidence that services grease the wheels of international commerce: A greater availability of services across regions, industries and time increases a firm's foreign sourcing of materials relative to sales. Interestingly, this positive impact of local service availability on imports especially applies to stand-alone firms that, unlike multinationals, are less likely to rely on imported or internally provided services.international trade; services; off-shoring; supply chain management; firm heterogeneity;

Greasing the Wheels of International Commerce: How Services Facilitate Firms' International Sourcing

We use unique plant-level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. To guide our empirical analysis we develop a monopolistic-competition model of the materials sourcing decisions of heterogeneous firms. The model generates predictions about how the intensity of international sourcing of materials depends on a firm’s productivity and the availability of local services. These predictions are supported by the data. We find evidence that more productive manufacturing firms tend to have a higher ratio of imported materials to sales. In addition, we find evidence that services grease the wheels of international commerce: A greater availability of services across regions, industries and time increases a firm’s foreign sourcing of materials relative to sales. Interestingly, this positive impact of local service availability on imports especially applies to stand-alone firms that, unlike multinationals, are less likely to rely on imported or internally provided services.international trade, services, off-shoring, supply chain management, firm heterogeneity

Greasing the Wheels of International Commerce: How Services Facilitate Firms’ International Sourcing

We use unique plant-level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. To guide our empirical analysis we develop a monopolistic competition model of the materials sourcing decisions of heterogeneous firms. The model generates predictions about how the intensity of international sourcing of materials depends on a firm’s productivity and the availability of local services. These predictions are supported by the data. We find evidence that more productive manufacturing firms tend to have a higher ratio of imported materials to sales. In addition, we find evidence that services grease the wheels of international commerce: A greater availability of services across regions, industries and time increases a firm’s foreign sourcing of materials relative to sales. Interestingly, this positive impact of local service availability on imports especially applies to stand-alone firms that, unlike multinationals, are less likely to rely on imported or internally provided services.international trade, services, off-shoring, supply chain management, firm heterogeneity.

Governance of substance use as a by-product of policing in Norway : a historical account

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Military Spending, the Peace Dividend, and Fiscal Adjustment

This paper decomposes the sources of the peace dividend into global, regional, and country-specific factors, and analyzes their relative importance. It finds that the easing of international and regional tensions and the existence of IMF-supported adjustment programs are systematically related to lower military spending and a higher share of nonmilitary spending in total government outlays. The easing of international tensions and of regional tensions since the end of the Cold War and the existence of IMF-supported adjustment programs account for 66 percent, 26 percent, and 11 percent of the decline in military spending, respectively. Furthermore, fiscal adjustment has implied a larger cut in military spending of countries with IMF-supported programs. Copyright 2001, International Monetary Fund