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N° 2009-39 |
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| December 2009 |
The Effects at Home of Initiating Production Abroad:
Evidence from Matched French Firms |
Alexander Hijzen
Sébastien Jean
Thierry Mayer |
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| Based on matching techniques in combination with a difference-in-difference estimator, this
paper estimates the effects at home of initiating production abroad through the establishment
of a foreign production affiliate. The analysis covers manufacturing and service firms active
in France during the period 1987-1999. We show that the motivation to start producing
abroad is an important determinant of its impact at home. Market-seeking FDI in
manufacturing is associated with significant scale effects, resulting in job creation. By
contrast, factor-seeking FDI in manufacturing has no significant effect on employment.
However, there is some evidence that this type of FDI is associated with technology effects,
in the form of greater capital-intensity and efficiency, as well as larger exports. Finally, FDI
in service sectors is associated with significant positive employment effects, presumably
reflecting the importance of the market-seeking motive in these sectors. |
Non-technical summary  |
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Résumé
non-technique
en français |
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| Full text |
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| FDI; multinationals; propensity score matching; services; delocalisation |
Keywords |
| F14; F21; F23 |
JEL classification |
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