Foreign Firms and Local Communities / Bruce Blonigen, Cheyney O'Fallon.

Format:

Book

Author/Creator:

Blonigen, Bruce.

Contributor:

National Bureau of Economic Research.

O'Fallon, Cheyney.

Series:

Working Paper Series (National Bureau of Economic Research) no. w17282.

NBER working paper series no. w17282

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2011.

Summary:

The literature on the effects of foreign direct investment (FDI) and activities of multinational enterprises (MNEs) on host-countries has been almost exclusively focused on issues of productivity, growth and wages. We argue that this leaves quite a bit of important unexplored areas of inquiry, particularly those connected with the interactions of local communities and governments with MNEs. As an example, we provide a novel analysis of local corporate philanthropy, which shows significant differences between local- and foreign-owned corporations. We find that foreign-owned enterprises are less likely to give, but that when they do give, it is substantially more in magnitude than domestic firms, everything else equal. This evidence is consistent with the hypothesis that foreign-owned firms would prefer to use corporate social responsibility (CSR) activities on a more international scale, but will strategically use CSR activities for public relation motives when the MNE faces greater local scrutiny and/or bias.

Notes:

Print version record

August 2011.