Logo
Munich Personal RePEc Archive

The Resilience of FDI to Natural Disasters through Industrial Linkages

Kato, Hayato and Okubo, Toshihiro (2021): The Resilience of FDI to Natural Disasters through Industrial Linkages.

[img]
Preview
PDF
MPRA_paper_111187.pdf

Download (1MB) | Preview

Abstract

When do multinationals show resilience during natural disasters? To answer this, we develop a simple model in which foreign multinationals and local firms in the host country are interacted through input-output linkages. When natural disasters seriously hit local firms and thus increase the cost of sourcing local intermediate inputs, most multinationals may leave the host country. However, they are likely to stay if they are tightly linked with local suppliers and face low trade costs of importing foreign intermediates. We further provide a number of extensions of the basic model to incorporate, for example, multinationals with heterogeneous productivity and disaster reconstruction.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.