A study of the location of foreign acquisitions and new plant establishments in the US market

Since 1978, the US has been the single largest recipient of foreign direct investment (FDI). The economic consequences of the growth of FDI in the US have been speculated by political and economic analysts. It is expected that foreign investors may respond differentially to locational advantages depending on the mode of their investment in the US market. The acquisition of a domestic firm and the establishment of new plants are the two major modes of FDI. The purpose of this study is to analyze the spatial distribution of foreign acquisitions and new plants, from major source countries, in US manufacturing. The study will examine the effect of a set of location determinants representing labor market conditions and the general economic environment on the spatial distribution of: acquisitions by Canadian and West European firms; acquisitions by Japanese firms; new plants established by Canadian and West European investors; and new plants established by Japanese investors. -from Author