PUBLICATIONS & REPORTS
PUBLICATIONS & REPORTS
From Kitakyushu to the world: AGI, a research institute that studies Asia's economy and society
Comparative Advantage and Vertical Multinational Enterprises
| Author | Kazuhiko Yokota |
|---|---|
| Date of Publication | 2004. 12 |
| No. | 2004-34 |
| Download | 446KB |
Contents Introduction
This paper builds a model of vertical multinational firms with endogenous spillover that explains recent empirical findings. First, vertical multinational firms invest more in low-tech industries than in high-tech industries in skill scarce countries while they invest more in high-tech industries than in low-tech industries in skill abundant countries. Second, the effects of technology transfers are limited only in low-tech sectors in skilled labor scarce economies. To explain these findings, I emphasize industry characteristics as well as country characteristics in a small open general equilibrium framework.