FDI and superstar spillovers: evidence from firm-to-firm transactions

Amiti, Mary, Duprez, Cedric, Konings, Jozef and Van Reenen, John ORCID: 0000-0001-9153-2907 (2024) FDI and superstar spillovers: evidence from firm-to-firm transactions. Journal of International Economics, 152. ISSN 0022-1996

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Abstract

Using firm-to-firm transactions, we show that starting to supply a ‘superstar’ firm (large domestic firms, exporters and multinationals) boosts productivity by 8% after three years. Placebos on starting relationships with smaller firms and novel identification strategies support a causal interpretation of “superstar spillovers”. Consistent with a model of technology transfer, we find bigger treatment effects from technology-intensive superstars and also falls in markups (in order to win superstar contracts). We also show that firms that start supplying superstar firms enjoy a ‘dating agency’ effect — an increase in the number of new buyers that is particularly strong within the superstar firm’s network. Taken together, the results suggest an important role for raising productivity through superstars’ supply chains regardless of multinational status.

Item Type:	Article
Official URL:	https://www.sciencedirect.com/journal/journal-of-i...
Divisions:	Economics
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HF Commerce
JEL classification:	F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms; International Business O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O30 - General F - International Economics > F2 - International Factor Movements and International Business > F21 - International Investment; Long-Term Capital Movements
Date Deposited:	27 Aug 2024 13:12
Last Modified:	01 Nov 2024 05:47
URI:	http://eprints.lse.ac.uk/id/eprint/124676

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