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dc.contributor.authorMcGaughey, Sara L
dc.contributor.authorRaimondos, Pascalis
dc.contributor.authorla Cour, Lisbeth
dc.description.abstractHow does the presence of ‘controlled’ foreign firms affect the productivity of domestic firms in the same industry? We revisit the historical distinction between control and influence by the foreign owner and define ‘controlled’ foreign firms as those with a foreign ultimate owner holding 50% or more of voting shares. Connecting insights from new internalization theory with knowledge-based views of the MNE, we posit that ‘controlled’ foreign firms will generate larger productivity spillovers than non-controlled foreign firms. We use a firm-level panel dataset of 575,844 manufacturing firms (2,343,495 observations) across 20 European countries to test our proposition. We pay careful attention to how firms are categorized as foreign, taking into account both direct and indirect ownership links. Allowing for indirect ownership turns out to be pivotal: there are just as many indirectly controlled foreign firms as foreign firms captured with direct ownership data. We find positive horizontal spillovers from controlled foreign firms and zero spillovers from non-controlled foreign firms. Interestingly, the strongest positive spillovers come from the indirectly controlled foreign firms. The implications of our study extend beyond productivity spillovers to areas such as cross-border M&As, joint ventures, MNE strategies of legitimation, and corporate groups.
dc.relation.ispartofjournalJournal of International Business Studies
dc.subject.fieldofresearchApplied Economicsen_US
dc.subject.fieldofresearchBusiness and Managementen_US
dc.subject.keywordsSocial Sciencesen_US
dc.subject.keywordsBusiness & Economicsen_US
dc.subject.keywordsforeign direct investmenten_US
dc.titleForeign influence, control, and indirect ownership: Implications for productivity spillovers
dc.typeJournal article
dc.type.descriptionC1 - Articles
dcterms.bibliographicCitationMcGaughey, SL; Raimondos, P; la Cour, L, Foreign influence, control, and indirect ownership: Implications for productivity spillovers, Journal of International Business Studies, 2020
gro.description.notepublicThis publication has been entered in Griffith Research Online as an advanced online version.en_US
gro.hasfulltextNo Full Text
gro.griffith.authorMcGaughey, Sara L.

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