On the Role of Distance for Outward FDI

  title={On the Role of Distance for Outward FDI},
  author={Peter Egger},
This paper focuses on the estimation of three distance-related effects on outward FDI. (i) Distance harms vertical multinationals, since they engage in trade. (ii) It makes non-trading multinationals better off than exporters. (iii) This positive effect on horizontal FDI is expected to rise with bilateral country size due to the home market effect. The use of panel data and related econometric methods is highly recommended to avoid parameter bias from endogenous, unobserved, time-invariant… CONTINUE READING
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