Domestic, vertical, and horizontal multinationals : a general equilibrium approach using the "knowledge capital model"

One of the key factors behind the growth in global trade in recent decades is an increase in intermediate input as a result of the development of vertical production networks (Feensta, 1998). It is widely recognized that the formation of production networks is due to the expansion of multinational enterprises' (MNEs) activities. MNEs have been differentiated into two types according to their production structure: horizontal and vertical foreign direct investment (FDI). In this paper, we extend the model presented by Zhang and Markusen (1999) to include horizontal and vertical FDI in a model with traded intermediates, using numerical general equilibrium analysis. The simulation results show that horizontal MNEs are more likely to exist when countries are similar in size and in relative factor endowments. Vertical MNEs are more likely to exist when countries differ in relative factor endowments, and trade costs are positive. From the results of the simulation, lower trade costs of final goods and differences in factor intensity are conditions for attracting vertical MNEs.Developing countries, Developed countries, Foreign investments, International business enterprises, Foreign Direct Investment, Knowledge-Capital Model

Domestic, vertical, and horizontal multinationals : a general equilibrium approach using the "knowledge capital model"

One of the key factors behind the growth in global trade in recent decades is an increase in intermediate input as a result of the development of vertical production networks (Feensta, 1998). It is widely recognized that the formation of production networks is due to the expansion of multinational enterprises\u27 (MNEs) activities. MNEs have been differentiated into two types according to their production structure: horizontal and vertical foreign direct investment (FDI). In this paper, we extend the model presented by Zhang and Markusen (1999) to include horizontal and vertical FDI in a model with traded intermediates, using numerical general equilibrium analysis. The simulation results show that horizontal MNEs are more likely to exist when countries are similar in size and in relative factor endowments. Vertical MNEs are more likely to exist when countries differ in relative factor endowments, and trade costs are positive. From the results of the simulation, lower trade costs of final goods and differences in factor intensity are conditions for attracting vertical MNEs

Evaluating the Asian international input-output table in comparison with the three major multiregional input-output tables

This paper introduces the existing multiregional Input-Output (MRIO) Tables i.e., IDE, ADB, OECD, and GTAP with special attention to the method of constructing import matrix. Also, the similarities and differences among the four MRIO Tables are studied in this paper, setting the IDE table as the benchmark. From the results of comparison of major economic indicators with WDI, IDE and OECD shows similarity to WDI, compared to GTAP and ADB. However, TiVA indicators show considerably different values in motor vehicles and motorcycles in Indonesia. Whereas there is some possibilities Indonesia’s TiVA is overestimation, it can be said that the IDE table might captures the proper production structure. In order to understand the reason why different value in the IDE table occurs, an additional survey on import demand might be required

Is FTA/EPA effective for a developing country to attract FDI? : simulation analysis based on an extended knowledge-capital model

To prepare an answer to the question of how a developing country can attract FDI, this paper explored the factors and policies that may help bring FDI into a developing country by utilizing an extended version of the knowledge-capital model. With a special focus on the effects of FTAs/EPAs between market countries and developing countries, simulations with the model revealed the following: (1) Although FTA/EPA generally ends to increase FDI to a developing country, the possibility of improving welfare through increased demand for skilled and unskilled labor becomes higher as the size of the country declines; (2) Because the additional implementation of cost-saving policies to reduce firm-type/trade-link specific fixed costs ends to depreciate the price of skilled labor by saving its input, a developing country, which is extremely scarce in skilled labor, is better off avoiding the additional option; (3) If a country hopes to enjoy larger welfare gains with EPA, efforts to increase skilled labor in the country, such as investing in education, may be beneficial

Theory and empirics of Markusen type multinationals

Research on multinational firms’ activity has been conducted widely since late 1980s. The literature is differentiated into three types: horizontal FDI, vertical FDI, and three-country FDI, represented by export platform FDI. There are other methods of differentiation of the literature by approach, for example, the pure theory approach represented by Krugman and Melitz and the numerical simulation approach represented by Markusen. This paper surveys Markusen type literature by firm type. There is little literature focused on intermediate goods trade, although intermediate goods trade is considered to be strongly related to the production patterns of MNEs. In this paper, we introduce a model to explicitly treat intermediate goods trade and present simulation analysis for empirical estimation

A Vocabulary Analysis of Maritime English Text Using AntConc

将来の海技士に求められる英語力は「必要最低限のコミュニケーション」を目的とするSMCPの習得にとどまらず、必要な海事情報を得るための書きことばを読解する力にまで拡充すべきである。それでは、それを達成するためには、どのような語彙を習得すればよいのか？この疑問に答える一手段として、本研究ではAntConcを用いて海事英語テキストRisk Watchを構成する語彙特徴を明らかにする分析を試みた。言語データを概観すると共に、主に高頻度語の特徴に着目し、BNC に代表される一般英語との類似点と相違点を示した。分析の結果、一般英語と海事英語の機能語の使われ方は類似していたが、内容語の高頻度語の種類には大きな違いが見られた。海事英語テキストの内容を理解するための語彙として、高校レベルにプラスαの知識が必要とされることを示唆している。今後、頻度上位1,000語を構成する内容語の用法を綿密に記述し、高校レベルまでの英語学習を済ませた学習者が更に海事英語を身につけて行く際の語彙学習の指針となるような事実を明らかにすることが期待される。The English proficiency required to prospective deck officers should not be limited to the mastery of SMCP, which only guarantees “a minimum level of communication,” but should extend to the attainment of the ability to comprehend information provided in English texts on Maritime issues. In order to explore the kind of vocabulary necessary for reading Maritime English texts, this study attempted a corpus analysis of Maritime English text Risk Watch using AntConc. An overview of the Maritime English corpus was given, followed by a comparison with the so-called “general English,” which was represented by the British National Corpus (BNC) in this study. In the analysis focusing on high-frequency words, it was revealed that the type of content words frequently used in Maritime English differs from that in the BNC. The result highlighted the necessity for deck cadets to learn relatively higher-level words and acquire knowledge on usage peculiar to Maritime English. Further linguistic investigation of the 1,000 most frequently used words in the future will provide hints to establish guidelines for practical vocabulary learning of Maritime English.東京海洋大学大学院海洋工学系海事システム工学部