Emerging multinationals : trends, patterns and determinants of outward investment by Indian enterprises
Date
2006
Authors
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Publisher
Research and Information System for Developing Countries (RIS), New Delhi, IN
Abstract
This paper has analyzed the trends, patterns and determinants of outward
Investments by Indian enterprises that have increased notably since the onset of
reforms. It finds that the sharp rise in outward investments since 1991 has been
accompanied by a shift in geographical and sectoral focus of Indian investments.
It develops an analytical framework for explaining the probability of an Indian
enterprise investing abroad in an exclusive large dataset of Indian enterprises.
The findings suggest that Indian enterprises draw their ownership advantages
from their accumulated production experience, cost effectiveness of their production
processes and other adaptations to imported technologies made with their
technological effort, and some times with their ability to differentiate product.
Firm size exerts a positive but a non-linear effect. Enterprises that are already in
export markets are more likely to be outward investors. Finally, policy liberalization
of 1990s turns out to have pushed Indian enterprises abroad.
Description
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Working Paper
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Keywords
TRANSNATIONAL CORPORATIONS, TRADE LIBERALIZATION, DIRECT INVESTMENT, GOVERNMENT POLICY, INDIA, ECONOMIC INTEGRATION, TECHNOLOGICAL CHANGE