Creating backward linkages from multinationals: is there a role for financial incentives?

Arbeitspapier

We investigate whether government subsidies to local input manufacturers encourage procurement from foreign firms. We use a comprehensive panel data of Irish firms from 1983 until 2002. Our data shows a spontaneity about linkages and relative insensitivity to grant aid, although it may be the quality rather than quantity of linkages that matters. The longevity of a foreign firm's stay is one consistent driver of linkages where foreign firms need time to find out about local suppliers. Our results hold even when controlling for the possible joint determination of grants and linkages and the boundedness of the linkage variable.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Kiel Working Paper ; No. 1554

Classification and Topics

• Classification: Wirtschaft ; Multinational Firms; International Business ; Industrialization; Manufacturing and Service Industries; Choice of Technology ; Business Taxes and Subsidies including sales and value-added (VAT)
• Subject: Multinational enterprises ; backward linkages ; subsidies ; Multinationales Unternehmen ; Lieferanten-Kunden-Beziehung ; Lieferant ; Subvention ; Wirtschaftspolitische Wirkungsanalyse ; Irland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Görg, Holger ; Hanley, Aoife ; Strobl, Eric
• Event: Veröffentlichung
• (who): Kiel Institute for the World Economy (IfW)
• (where): Kiel
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/28381
• Last update: 10.03.2025, 11:44 AM CET