Title: International relocation of production: Where do firms go?
Authors: Sleuwaegen, Leo ×
Pennings, Enrico #
Issue Date: Sep-2006
Publisher: Blackwell publishing
Series Title: Scottish journal of political economy vol:53 issue:4 pages:430-446
Abstract: The flexible relocation of capacity across countries by multinational enterprises has become an important source of concern. Using a unique sample of relocating firms in Belgium, we find that wages and market potential of host regions are important determinants for the location choice. Considering firm characteristics, we show that large firms have a higher propensity to relocate to remote countries. Public aid only plays a decisive role in the investment decision for relocations to adjacent countries, suggesting a potential harmful role in distorting competition. More proactive policies in line with changing comparative location advantages should be implemented to accommodate relocations.
ISSN: 0036-9292
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Department of Managerial Economics, Strategy and Innovation (MSI), Leuven
× corresponding author
# (joint) last author

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