WHAT ATTRACTS FOREIGN MULTINATIONAL CORPORATIONS? EVIDENCE FROM BRANCH PLANT LOCATION IN THE UNITED STATES

Daniel A. Gerlowski · Johnathan Silberman

453 citations0/0 files storedJournal of Regional Science

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International Business and FDI Regional Economics and Spatial Analysis Economic Zones and Regional Development

Abstract

ABSTRACT. The location decisions of foreign multinational corporations (FMNCs) are analyzed using a conditional logit model with states as the choice set. We consider the establishment of new manufacturing plants and separately analyze the site selection of all MNCs, Japanese MNCs, and European MNCs. The results indicate that access to markets, labor market conditions, state promotional efforts to attract foreign investment, and state and local personal taxes are significant fadors in the location decision. The decision determinants for Japanese and European MNCs are found to be different.

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1986Market Structure and Foreign Trade 1991Who Benefits from State and Local Economic Development Policies?1979Spatial interaction theory and planning models 1983The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables 1991State Characteristics and the Location of Foreign Direct Investment within the United States

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