Regional determinants of German FDI in the Czech Republic: evidence from a gravity model approach

Johannes Schäffler, Veronika Hecht and Michael Moritz
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Johannes Schäffler: Institute for Employment Research (IAB), Nuremberg, Germany

No 201403, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "The attractiveness for the location of multinational firms is seen as a crucial issue for the development and prosperity of regions. This article focuses on a two-country relationship and deals with the regional distribution of German multinational firms and their affiliates in the Czech Republic. A new dataset established by the IAB covers information on the basic population of cross-border foreign direct investment (FDI) projects, thereby exceeding the number of observations in previously used databases by far. On the basis of 3,894 FDI projects the regional determinants of German cross-border investments in the Czech Republic are analysed for both the home and the host country. Alternative specifications of the gravity model are used in order to investigate the regional distribution of common investment projects that are calculated as a combination of a headquarters in a German spatial planning region and an affiliate in a Czech NUTS 3 region. Concerning the explanatory variables a distinction is made between three groups of factors: first, market size and agglomeration features of the regions; second, attributes representing the distance between the headquarters in Germany and the affiliates in the Czech Republic; and third, regional labour market characteristics. While the findings are generally in line with theoretical expectations, differences emerge between manufacturing FDI and services FDI." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; Tschechische Republik; Auslandsinvestitionen; Bevölkerungsdichte; Determinanten; Herkunftsland; Absatzmarkt; multinationale Unternehmen; ökonomische Faktoren; regionale Faktoren; regionale Verteilung; regionaler Arbeitsmarkt; sektorale Verteilung; Standortwahl; Arbeitskosten; Transaktionskosten; Wirtschaftszweige; 2009-2009 (search for similar items in EconPapers)
JEL-codes: F15 F23 R12 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2014
New Economics Papers: this item is included in nep-cse, nep-eur, nep-geo, nep-int, nep-sbm, nep-tra and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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https://doku.iab.de/discussionpapers/2014/dp0314.pdf

Related works:
Working Paper: Regional Determinants of German FDI in the Czech Republic - Evidence from a gravity model approach (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:201403

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