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Regional headquarters and foreign direct investment

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IMPORTANT: Aquest repositori està en una versió antiga des del 3/12/2023. La nova instal.lació está en https://roderic.uv.es/

Regional headquarters and foreign direct investment

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Gil Pareja, Salvador; Llorca Vivero, Rafael; Paniagua Soriano, Jordi
Aquest document és un/a article, creat/da en: 2022

Headquarters (HQs) provide a wide range of services, playing a fundamental role in Foreign Direct Investment (FDI). We use the structural gravity equation to investigate the effect of regional HQs on three dimensions of FDI (number of foreign projects, capital investment, and jobs) at the country-pair-sector level. Furthermore, we explore two underlying mechanisms that help explain this relationship: financial constraints and informational costs and uncertainty. We find a positive effect of regional HQs on FDI, as well as intercountry and intersector spillovers. Our results are robust, accounting for HQ intensity, domestic investment, and endogeneity tests.
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