Toward A Synthesis Of Micro And Macro Factors That Influence Foreign Direct Investment Location Choice

Authored by: Bo Nielsen , Christian Asmussen , Anthony Goerzen

The Routledge Companion to the Geography of International Business

Print publication date:  March  2018
Online publication date:  March  2018

Print ISBN: 9781138953345
eBook ISBN: 9781315667379
Adobe ISBN:

10.4324/9781315667379-12

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Abstract

Recent evidence suggests that multinational corporations (MNCs) pay increasing attention to sub-national locational factors at the state, municipality, and city level when considering a suitable foreign direct investment (FDI) site (Cheng, 2007). While macro-level theories of economic agglomeration and institutions have provided insights into this phenomenon, additional guidance from Economic Geography and urban economics would provide a fuller picture of sub-national variation in FDI location attractiveness. Since MNCs look for specific geographic locations that enhance their ability to leverage firm-specific advantages, a synthesis of the interplay of national and sub-national, as well as firm-specific drivers of FDI location choice is needed in order to advance our understanding of MNC location strategy.

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