Offshoring, foreign direct investment, and the structure of U.S. trade

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Theory suggests that multinational enterprises (MNEs) play the role of factor service intermediaries in international trade. This paper presents the results of an empirical analysis that exploits variation in the intrafirm trade by U.S. MNEs across countries and industries to assess this theory. The results provide support for recent models of multinational enterprise and suggest that the activities of U.S. MNEs alter the structure of international trade, particularly among middle-income countries.

Original languageEnglish (US)
Pages (from-to)602-611
Number of pages10
JournalJournal of the European Economic Association
Issue number2-3
StatePublished - 2006

All Science Journal Classification (ASJC) codes

  • General Economics, Econometrics and Finance


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