Browsing by Author "Yeung, Bernard"

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    Foreign direct investment and host country productivity : the case of the American automotive components industry
    (1994-10-26) Chung, Wilbur; Mitchell, Will; Yeung, Bernard
    This paper examiners the relationship between American automobile component manufacturers productivity and inward foreign direct investment in the US automobile industry between 1979 and 1991. During this. Several Japanese owned automobile assemblers establish North American production facilities. We describe three mechanisms by which foreign direct investment might increase or decrease the productivity of firms operating in the host country (1)greater productivity due to direct technology transfer(2) greater productivity due to increased competition and (3) lower productivity due to artificial increase in domestic production introduced by important trade barriers. We find that firms that sold components to the Japanese owned assembles (tic-in firms) were less productive larger and more labor intensive than firms that did not sell components to the transplants. Non-tie in firms were more likely than tie-in firms to exceed the industry during the study period. Finally we find that the non-tie in firms became increasingly more productive than the tie-in firms. The results of this study suggest that the productivity improvements in the American automobile components industry during the 1980s see more from competitive pressure in the motor vehicle sector then from direct technology transfer from Japanese own automobile assembles. The lack of direct technology transfer could be explained by the outsourcing of mainly simple components from American suppliers by the Japanese transplants.
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    Research forum on international economics : international an event study
    (2022) Morck, Randall; Yeung, Bernard
    The internalization theory of multinational firms proposes that direct international investment occurs when firm has information related intangible assets with public good properties. We find that firms with characteristics suggesting the presences of information based assets experiences a significantly positive stock prices reaction upon announcing a foreign acquisition. on the other hand firms apparently lacking such assets experience at best zoro abnormal returns upon announcing overseas acquisitions.
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    Why investors value multinationality
    (Institute of Public Policy studies , Michigan, 1991-04) Morck, Randall; Yeung, Bernard
    We examine the value of multinationality to investors as reflected in firms q ratios. The positive impact of R&D and advertising spending on a firms q is enhanced by multinationality, but multinationality itself has no significant impact. This supports the internalization theory which holds that intangible assets are necessary to justify direct foreign investment: and thus a recent strand of trade literature which assumes that multinational firms have intangible assets with public good properties. Our results do not support the hypothesis that investors value multinational firms as a means of diversifying their portfolios internationality.