FDI by Early Movers, Followers and Latecomers: Timing of Entry by German Firms during Transition in the Czech Republic

Publication Type
Journal contribution (peer reviewed)
Authors
Henning Mühlen & Peter Nunnenkamp
Year of publication
2011
Published in
Applied Economics Letters
Band/Volume
Vol. 18/No. 18
ISBN / ISSN / eISSN
1466-4291
DOI
10.1080/13504851.2011.562149
Page (from - to)
1729-1734
Abstract

We analyse Foreign Direct Investment (FDI) decisions by German firms with and without affiliates in the Czech Republic at different stages of transition. We find that FDI entry strongly depends on firm productivity immediately after the political and economic regime change, but less so with diminishing uncertainty. Likewise, distance-related transaction costs discourage FDI by latecomers considerably less than FDI by early movers.

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