Re: Counting: It's Fun.
21961
I on behalf of the world would like to tell JayRedd to Shut Up.
Also
Increasingly the world is becoming globalised and the riots at Seattle, Stockholm and Genoa provide some evidence of the power and control of Multinational or Transnational Companies (MNCs/TNCs) and the subsequent backlash against this. The forces that have led to the growth of MNCs/TNCs are manifold but would include the reduction in trade barriers, the development of the global triad trading block system (South East Asia and China, Europe, and North America), the liberalisation and deregulation of markets, the move towards world-wide privatisation, strategic decisions by organisations that wish to dominate world markets as their domestic market growth rates have slowed down, and the increased competition some organisations are finding in their domestic markets. All these factors together have seen the growth almost year-on-year of foreign direct investment (FDI), as organisations seek to take advantage of market and cost saving opportunities both within Europe and in the UK in particular.
Whilst a growing number of econometric and survey-based studies have been published that focus on the key influences which determine inbound FDI at the national level, relatively few studies exist into the forces which affect the distribution of FDI between UK regions. The aim of this paper is to rectify this omission by seeking to identify and analyse a set of factors that influence the attraction of inbound FDI to UK regions.
LOCATIONAL CHOICE OF FDI BY TNCs
Theoretical work by Stopford and Strange (1991) and Dunning (1993) suggests that four main factors determine the national and regional location of FDI by transnational corporations (TNCs). These are: (physical, labour or technological); the search for markets (following customers, suppliers or competitors abroad, seeking increased familiarity with the local business environment or reducing their costs of supplying a foreign market); the search for efficiency (exploiting different factor endowments, cultures, institutional arrangements, economic systems and policies and market structures); and finally the search for strategic assets (enabling them to sustain and advance their international competitive advantages). In addition, national and regional resource endowments; market access and potential; favourable competitive positions; strong consumer demand; and favourable government policies can all help in attracting FDI to specific national and regional locations.
This paper focuses on three main 'influencers' of inbound investment: market, resources, and efficiency-seeking FDI. Strategic asset-seeking FDI is excluded from the study, since it proved incapable of measurement using the published UK data available at the time of the preliminary study.
EARLIER STUDIES
Studies carried out in the USA and the UK provide further support for the importance of resources, market and efficiency considerations in determining the distribution of inbound FDI at the regional level. A number of American studies (Bagchi-Sen and Wheeler, 1989; McConnell, 1980; Mandell and Killian, 1974; Arpan and Ricks, 1995) suggest that market-related factors, such as market proximity, population size and growth rates, levels of per capita retail spending and regional infrastructure provision are also found to be of importance in attracting FDI at the regional level. Other studies (Little, 1978; Glickman and Woodward, 1988; Mandell and Killian, 1974 and Arpan and Ricks, 1995) indicate that the location of FDI is especially sensitive to resource-based influences, such as labour availability, wage differentials and educational attainment levels. Efficiencyrelated factors including government aid, state spending levels, regional taxation levels and the level of industrial development in host regions are also significant (see McConnell, 1980; Mandell and Killian, 1974; Arpan and Ricks, 1995).
Studies based on UK regional data provide broad support for these American findings. Market-related influences such as infrastructure investment (Hill and Munday, 1991) and high population density (Billington, 1999) are considered to be significant in attracting inbound FDI to particular UK regions. In terms of resources, Billington (1999) suggests that high unemployment and related labour availability can both exercise a significant positive impact on FDI inflows at the regional level, whilst Collis and Noon (1994) show that high unit wage costs can have the opposite effect. Taylor (1993) and Billington (1999) provide evidence of efficiencyseeking FDI, arguing that preferential assistance to depressed regions and the regional industrial mix both exert a strong influence on the distribution of inbound FDI amongst UK regions. Hill and Munday (1991 and 1992) also find that government regional policy, based on regional preferential assistance and infrastructure spending, can help in attracting FDI towards particular UK regions.
CHANGES IN THE REGIONAL DISTRIBUTION OF INBOUND FDI
Recent research evidence (Roberts et al, 1988; Collis et al, 1989; Hill and Munday, 1992, Meyer and Qu, 1995) suggests that changes have occurred in the distribution of inbound FDI between UK regions since the early 1970s. The heavy concentration of FDI in the south-eastern core of the UK economy has given way to a more even distribution, in which peripheral regions such as Scotland, Wales and the North of England, and latterly, intermediate regions such as the West Midlands have been increasingly favoured by foreign investors. These findings form the basis for the present study, and for the choice of regions included in it.
21961
I on behalf of the world would like to tell JayRedd to Shut Up.
Also
Increasingly the world is becoming globalised and the riots at Seattle, Stockholm and Genoa provide some evidence of the power and control of Multinational or Transnational Companies (MNCs/TNCs) and the subsequent backlash against this. The forces that have led to the growth of MNCs/TNCs are manifold but would include the reduction in trade barriers, the development of the global triad trading block system (South East Asia and China, Europe, and North America), the liberalisation and deregulation of markets, the move towards world-wide privatisation, strategic decisions by organisations that wish to dominate world markets as their domestic market growth rates have slowed down, and the increased competition some organisations are finding in their domestic markets. All these factors together have seen the growth almost year-on-year of foreign direct investment (FDI), as organisations seek to take advantage of market and cost saving opportunities both within Europe and in the UK in particular.
Whilst a growing number of econometric and survey-based studies have been published that focus on the key influences which determine inbound FDI at the national level, relatively few studies exist into the forces which affect the distribution of FDI between UK regions. The aim of this paper is to rectify this omission by seeking to identify and analyse a set of factors that influence the attraction of inbound FDI to UK regions.
LOCATIONAL CHOICE OF FDI BY TNCs
Theoretical work by Stopford and Strange (1991) and Dunning (1993) suggests that four main factors determine the national and regional location of FDI by transnational corporations (TNCs). These are: (physical, labour or technological); the search for markets (following customers, suppliers or competitors abroad, seeking increased familiarity with the local business environment or reducing their costs of supplying a foreign market); the search for efficiency (exploiting different factor endowments, cultures, institutional arrangements, economic systems and policies and market structures); and finally the search for strategic assets (enabling them to sustain and advance their international competitive advantages). In addition, national and regional resource endowments; market access and potential; favourable competitive positions; strong consumer demand; and favourable government policies can all help in attracting FDI to specific national and regional locations.
This paper focuses on three main 'influencers' of inbound investment: market, resources, and efficiency-seeking FDI. Strategic asset-seeking FDI is excluded from the study, since it proved incapable of measurement using the published UK data available at the time of the preliminary study.
EARLIER STUDIES
Studies carried out in the USA and the UK provide further support for the importance of resources, market and efficiency considerations in determining the distribution of inbound FDI at the regional level. A number of American studies (Bagchi-Sen and Wheeler, 1989; McConnell, 1980; Mandell and Killian, 1974; Arpan and Ricks, 1995) suggest that market-related factors, such as market proximity, population size and growth rates, levels of per capita retail spending and regional infrastructure provision are also found to be of importance in attracting FDI at the regional level. Other studies (Little, 1978; Glickman and Woodward, 1988; Mandell and Killian, 1974 and Arpan and Ricks, 1995) indicate that the location of FDI is especially sensitive to resource-based influences, such as labour availability, wage differentials and educational attainment levels. Efficiencyrelated factors including government aid, state spending levels, regional taxation levels and the level of industrial development in host regions are also significant (see McConnell, 1980; Mandell and Killian, 1974; Arpan and Ricks, 1995).
Studies based on UK regional data provide broad support for these American findings. Market-related influences such as infrastructure investment (Hill and Munday, 1991) and high population density (Billington, 1999) are considered to be significant in attracting inbound FDI to particular UK regions. In terms of resources, Billington (1999) suggests that high unemployment and related labour availability can both exercise a significant positive impact on FDI inflows at the regional level, whilst Collis and Noon (1994) show that high unit wage costs can have the opposite effect. Taylor (1993) and Billington (1999) provide evidence of efficiencyseeking FDI, arguing that preferential assistance to depressed regions and the regional industrial mix both exert a strong influence on the distribution of inbound FDI amongst UK regions. Hill and Munday (1991 and 1992) also find that government regional policy, based on regional preferential assistance and infrastructure spending, can help in attracting FDI towards particular UK regions.
CHANGES IN THE REGIONAL DISTRIBUTION OF INBOUND FDI
Recent research evidence (Roberts et al, 1988; Collis et al, 1989; Hill and Munday, 1992, Meyer and Qu, 1995) suggests that changes have occurred in the distribution of inbound FDI between UK regions since the early 1970s. The heavy concentration of FDI in the south-eastern core of the UK economy has given way to a more even distribution, in which peripheral regions such as Scotland, Wales and the North of England, and latterly, intermediate regions such as the West Midlands have been increasingly favoured by foreign investors. These findings form the basis for the present study, and for the choice of regions included in it.
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