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FDI Effects on National Competitiveness: A Cluster Approach

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Abstract

Despite the close relationship between the activities of multinational enterprises (MNEs) and the competitiveness of host countries, few studies have linked these two subjects from a global perspective. Combining Porter’s approach and the work accomplished by international business economists provides a powerful analytical tool with which to review the recent empirical and theoretical literature on the effects of foreign direct investment (FDI) on national competitiveness. The contention is that FDI can indeed be a source of competitiveness but that previous studies have neglected the role of location, in particular the role of clustering on the absorptive capacity of the host State. The aim of this paper is to provide a comprehensive conceptual framework for assessing the effects of FDI on competitiveness to guide policy-makers as well as further research.

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Authors and Affiliations

  1. Department of Economics, Faculty of Economics and Social Sciences, University of Fribourg, Fribourg, Switzerland

    Philippe Gugler & Serge Brunner

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  1. Philippe Gugler
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  2. Serge Brunner
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Correspondence to Serge Brunner.

Additional information

This study is part of the research project entitled, “Multilateral Rules on Trade and Investment,” supported by the NCCR project “International Trade Regulation: From Fragmentation to Coherence,” World Trade Institute (WTI), Berne.

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Gugler, P., Brunner, S. FDI Effects on National Competitiveness: A Cluster Approach. Int Adv Econ Res 13, 268–284 (2007). https://doi.org/10.1007/s11294-007-9091-1

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  • DOI: https://doi.org/10.1007/s11294-007-9091-1

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