Distance, Trade and FDI: A Hausman-Taylor SUR Approach

Abstract

This paper analyzes the effects of distance as a common determinant of exports and FDI in a three factors New Trade Theory model assuming that distance affects both pure trade costs and plant set-up costs. Exports and FDI are not necessarily substitutes with respect to distance since the predicted sign depends on its importance for fixed plant set-up costs… (More)

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Cite this paper

@inproceedings{Egger2001DistanceTA, title={Distance, Trade and FDI: A Hausman-Taylor SUR Approach}, author={Peter H. Egger}, year={2001} }