Reconsidering the Backward Vertical Linkages of Foreign Affiliates: Evidence from Japanese Multinationals

Kozo Kiyota, Toshiyuki Matsuura, Shujiro Urata, Yuhong Wei

Research output: Contribution to journalArticle

32 Citations (Scopus)

Abstract

This paper examines the determinants of the backward vertical linkages of Japanese foreign affiliates in manufacturing for the period 1994-2000, focusing on the local backward linkages, or local procurement in the host country. Our major findings are twofold. First, the unobserved affiliate-specific characteristics explain the large part of the variation of the backward linkages among foreign affiliates. Second, the experience of the affiliate has positive and sometimes nonlinear effects on local procurement for the affiliates, especially in Southeast Asia and China.

Original languageEnglish
Pages (from-to)1398-1414
Number of pages17
JournalWorld Development
Volume36
Issue number8
DOIs
Publication statusPublished - 2008 Aug

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Keywords

  • China
  • foreign direct investment
  • local procurement
  • Southeast Asia
  • vertical backward linkages

ASJC Scopus subject areas

  • Economics and Econometrics
  • Development
  • Geography, Planning and Development
  • Sociology and Political Science

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