{"title":"International attractiveness of cities: The drivers of urban FDI","authors":"Pierre-Henri Bono, Quentin David, Rodolphe Desbordes","doi":"10.1111/roie.12774","DOIUrl":null,"url":null,"abstract":"Foreign direct investment (FDI) nowadays mostly corresponds to activities in urban areas. This study provides the first global analysis of the determinants of urban FDI (UFDI). We assemble and exploit a unique database on the location choices of multinational enterprises in urban areas worldwide to investigate the relevance of local, national, and dynamic drivers of cities' international attractiveness. We find that attractive cities are large, productive, endowed with transport infrastructure able to move goods and people within and beyond their borders, abundant in educated people, and embedded in attractive national spaces. Cities combining all these attributes tend to attract service activities. Attractiveness is persistent but can evolve depending on economic dynamism. A variance decomposition analysis indicates that the location choices of UFDI are mainly driven by city‐level determinants, notably transport infrastructure.","PeriodicalId":47712,"journal":{"name":"Review of International Economics","volume":null,"pages":null},"PeriodicalIF":1.0000,"publicationDate":"2024-07-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Review of International Economics","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1111/roie.12774","RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
Foreign direct investment (FDI) nowadays mostly corresponds to activities in urban areas. This study provides the first global analysis of the determinants of urban FDI (UFDI). We assemble and exploit a unique database on the location choices of multinational enterprises in urban areas worldwide to investigate the relevance of local, national, and dynamic drivers of cities' international attractiveness. We find that attractive cities are large, productive, endowed with transport infrastructure able to move goods and people within and beyond their borders, abundant in educated people, and embedded in attractive national spaces. Cities combining all these attributes tend to attract service activities. Attractiveness is persistent but can evolve depending on economic dynamism. A variance decomposition analysis indicates that the location choices of UFDI are mainly driven by city‐level determinants, notably transport infrastructure.
期刊介绍:
The Review of International Economics is devoted to the publication of high-quality articles on a full range of topics in international economics. The Review comprises controversial and innovative thought and detailed contributions from other directly related fields such as economic development; trade and the environment; and political economy. Whether theoretical, empirical or policy-oriented, its relevance to real world problems is of paramount concern.