Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 204: The EC and the Locational Choice of Swedish Multinational Companies

Birgitta Swedenborg
Additional contact information
Birgitta Swedenborg: Research Institute of Industrial Economics (IFN)

Abstract: In a world with multinational companies (MNC's) changes such as those implied by the realization of EC's internal market will affect the locational choice made by geographically mobile MNC's. The reason is that the reduction of trade barriers within the EC puts non-EC members at a competitive disadvantage relative to EC members, thereby increasing the incentive to produce within the common market. This is true even though there may be no absolute increase in trade barriers for non-members. This (highly preliminary) paper suggests how the effects of the internal market on the location of production can be analyzed in a partial equilibrium framework of a firm serving many national markets and able to produce in different countries. It uses unique survey data on Swedish MNC production and trade for the period 1965-86 and draws on previous analysis of the earlier part of that data to indicate how important these effects may be empirically.

Keywords: Multinational firms; European internal market; trade barriers; allocation of production; partial equilibrium

JEL-codes: F13; F23

17 pages, December 1988

Full text files

wp204.pdf PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Elisabeth Gustafsson ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2019-04-30 10:50:22.