Gábor Békés:Location of manufacturing FDI in Hungary: How important are business-to-business relationships?
Abstract
Seminar on 1 July, 2004
MNB Visitor Centre 3 pm
Gábor Békés
Central European University
Location of manufacturing FDI in Hungary: How important are business-to-business relationships?
Contributing to the new economic geography literature, this paper sets up a simple model with monopolistic competition and estimates the determinants of location choice. This research addresses three central questions: Is there an agglomeration effect strong enough to explain co-location? Does market access matter for the location of foreign investment even within a small country? Are input-output linkages the key motive for location? In this paper, I apply a discrete choice methodology to find out to what extent various factors like wages or market access influence location choice within one country. I use two detailed datasets of Hungarian firms and wages between 1992 and 2001 considering all new-born manufacturing companies with a foreign ownership. Estimations are carried out by applying discrete choice methodologies.
JEL classification: F23, R3, R55
Keywords: industrial location, FDI, regional policy, discrete choice models
Contact person: Zoltán Jakab M.