CEPII, Recherche et Expertise sur l'economie mondiale
Jeudi 17 novembre 2022
14.30-16.00 - 20, avenue de Ségur 75007 Paris
CEPII research seminar "Multinational Ownership and Trade Participation” by Paola Conconi (University of Oxford)

Paola Conconi
Professor of Economics (Statutory Chair) at the University of Oxford and a Professorial Fellow at New College Oxford

Professor Paola Conconi will be presenting her research paper "Multinational Ownership and Trade Participation" co-authored with Glenn Magerman, Fabrizio Leone and Catherine Thomas.

Affiliates of multinational corporations (MNCs) account for a disproportionately large share of international trade. The authors use rich firm-level data from Belgium to examine whether MNCs alleviate affiliates’ country-specific trade frictions through their networks. They find that switching from domestic to foreign ownership increases firms’ trade participation. This result is robust to using different reweighting methods to address selection into acquisition. They then estimate firm-level gravity regressions, exploiting geographical variation in the network structure of the parents. They find that new subsidiaries increase trade with countries in which their parent has a presence. This “MNC network effect” increases with (geographical or cultural) distance from Belgium, consistent with multinational ownership alleviating country-specific trade frictions. They also provide evidence of an “extended MNC network effect”: acquired firms increase trade with countries that are (geographically or culturally) close to their parents’ network.

The research paper is available here >>.
Contact: conferencesatcepii.fr