Does horizontal FDI lead to more knowledge spillovers than vertical FDI ?

We develop a simple model that endogenises the di¤erence in spillovers between horizontal and vertical FDI. We …nd that even though horizontal MNEs may transfer more advanced technology abroad, this does not imply that more knowledge spillovers occur. Despite the higher potential for knowledge spillovers, local …rms are less likely to absorb the more… CONTINUE READING