Other Article | Vox | January 8, 2010

Multinational Firms, Agglomeration, and Global Networks

by Laura Alfaro and Maggie Chen

Abstract

Agglomeration effects are important but difficult to measure. This column uses a new database with precise geographical information to investigate the locational interdependence of multinational firms. Knowledge spillovers and capital- and labour-market externalities exert a significant effect on the co-agglomeration of multinational headquarters, while input-output linkages also play a significant role in the case of subsidiary co-agglomeration.

Keywords: Geographic Location; Business Subsidiaries; Industry Clusters; Multinational Firms and Management; Network Effects;

Citation:

Alfaro, Laura, and Maggie Chen. "Multinational Firms, Agglomeration, and Global Networks." Vox (January 8, 2010).