I would like to thank Frédéric Peltrault, Jean-Marc Siroën, Lionel Fontagné, Davide Castellani, Flora Bellone, Hervé Boulhol, El Mouhoub Mouhoud and two anonymous referees for very useful comments and remarks. This research was funded by Pramex International (group Banque Populaire - Caisse d'Epargne).
The Location Choices of Multinational Firms: The Role of Internationalisation Experience and Group Affiliation
Version of Record online: 22 MAY 2014
© 2014 John Wiley & Sons Ltd
The World Economy
Volume 38, Issue 8, pages 1246–1277, August 2015
How to Cite
Gazaniol, A. (2015), The Location Choices of Multinational Firms: The Role of Internationalisation Experience and Group Affiliation. World Economy, 38: 1246–1277. doi: 10.1111/twec.12186
- Issue online: 13 AUG 2015
- Version of Record online: 22 MAY 2014
- Pramex International
This paper investigates whether location choices of multinational firms depend on their past export, import or Foreign Direct Investment (FDI) experience on foreign markets or the experience of other affiliated firms. Regardless of locations' characteristics, we find that exporting in a given country, and to a smaller extent importing from it, significantly increases the probability of investing in that particular country the following year. This preliminary exporting phase appears more important for firsttime investors. Moreover, location choices not only depend on the investor's own international experience, but also on the international experience of other affiliated firms: firms tend to invest in countries where the group already exports or owns a local affiliate. These last findings suggest the existence of coordinated strategies and/or information sharing between affiliated firms.