国家没有区位优势时的外商直接投资竞争外文翻译.docx

国家没有区位优势时的外商直接投资竞争外文翻译.docx

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国家没有区位优势时的外商直接投资竞争外文翻译

本科毕业论文（设计）外文翻译

外文题目：

Competitionforforeigndirectinvestmentwhencountries

Arenotsureofsitevalues

出处：

InternationalReviewofEconomicsandFinance

作者：

KorayKiymazandLeonTaylor

原文：

Competitionforforeigndirectinvestmentwhencountriesarenotsureofsitevalues

Abstract

Thefiscaltug-of-warbetweentwocountriestoplayhosttoaforeign-ownedfirmislikeaNashgame.Supposethatthecountriesarenotsurehowmuchthefirmvaluesthesitesthattheyoffertoit.Alsosupposethatthecountriesfashiontheirexpectationofsitevaluebyassigningthesamelikelihoodtoeachvaluethattheydeempossible.Then,iftheyarequiteunsureaboutsitevalues,theywilloffersmallsubsidiestothefirm.Iftheyareprettysureaboutsitevalues,theywillofferlargesubsidies.Hereistheintuitionbehindtheresults:

Whenacountryisunsureaboutthevalueofitssite,itisalsounsureifastingyofferwilldrivethefirmtoitsrival,soitmaytakethechanceandmakeastingyofferratherthanagenerousone.

1.Introduction

Governmentsoftenvieforafootloosefirmbyofferingtaxcutsorsubsidies.Analysesofsuchacontestusuallyassumethatitsparticipantsknowfullwellitscircumstances.Inreality,itsparticipantsusuallyknowlittle.Forinstance,governmentofficialsmustguessathowmuchafirmvaluesasitewhentheyhavenocompetitivebidstoreferto.Thatisusuallythecasewhengovernmentrecruitsindustrybecausethelackoflocallandbuyersiswhatspursthegovernmenttoseekbuyerselsewhere.

Thegovernment’sguessaboutthevalueofasitewillaffectitsofferofincentivestoapotentialbuyer.Butifthegovernmentknowslittleaboutthevalueofitsownsite,thenitislikelytoknowlittleaboutthevalueofasiteelsewherethatthefirmcouldoccupy.Thegovernment’sguessaboutthatothersitewillalsoaffectitsofferofincentives.Howtheseguesseswillaffectitsofferisasubtlequestion,particularlywhenitmustcountertheofferofanothergovernmentthatguesses.

Thequestioniscriticaltotheearlystageofasitesearch,whenthefirmdecideswheretogo.Inthisstage,thefirmdisclosesstarkdetailsofitsprojecttoafewgovernmentsandsolicitstheirpreliminarybids.（HoodandYoung,1985,foundthatthisstrategywastypicalinthesearchesofautomotivefirmsforforeignsites.）Amongthegovernments,thefirmwilllaterpickonewithwhichtonegotiateinearnest.Untilthen,governmentsgamemorewithoneanotherthanwiththefirm,whichcarefullyconcealsitspokerhand.

Thispaperanalyzesthatearlystageofasitesearch.Thekeycharacteristicofthestageisthatthefirmkeepsthegovernmentsinthedarkaboutthevaluesthatitattachestotheirindustrialsites.Thepaperconsidershowtheresultinguncertaintyofgovernmentsaffectstheiroffersofincentivestothefirm.

Onecanobtainsharpanswerstothisquestionbecauseonecanreasonablypresumethatthegovernmentsaresureaboutafewthings.Inparticular,onecanpresumethateachgovernmentissureofhowtheotherwouldcounteritsoffer,foritislikelythatthegovernmentshavegamedbefore,perhapsintheconductofforeignrelations.Weneednotpresume,however,thateithergovernmentissureofhowthefirmwouldreacttotheiroffers.

Ingeneral,ouranalysisappliestoeconomiccompetitionbetweengovernmentsatthelocal,state,ornationallevel.Inparticular,itwillmotivatethemathematicsbyaddressingcontestsbetweencountriesforforeigndirectinvestment（FDI）.

Wefavortheinternationalapplicationforitstimeliness.Throughthe1970sanduntilthelate1980s,analystspositedthattheforeignfirmandthehosttreatedoneanotherwarily,likemonopolies.Vernon’s1971modelofbilateralmonopolydominatedtheliterature,andtheshiftofbargainingpowerfromoilextractorstooilproducersdominatedthenews.Inrecentyears,however,ThirdWorldhostshaveviedforforeignfirmsbyofferingsubsidiestothemaswellasbyliftingrestrictionsonthem.

Overtime,modelsofcompetitionthatcanapplytocountriesvyingforforeigndirectinvestmenthavecometostresstheaggressivetacticsofthepotentialhostsinpursuingfirms:

theconstructionofinfrastructuretoenticethem;thewillingnesstoreopennegotiationswiththemoreventobidinanauctionforthem.DoyleandvanWijnbergen（1994）analyzedafirmthatprocurestaxholidaysbybargainingwithoneGovernmentatatime.Bondandamuelson（1986）tookasimilartack,andAndersson（1991）examinedhowsequentialbargainingaffectsthedistributionofgainsfromforeigndirectinvestmentbetweenhostandfirm.BlackandHoyt（1989）modelafirmThatnegotiateswithseveralgovernmentsatthesametimeandthenchoosesitslocationonceandforall.Inanewtradition,KingandWelling（1992）examineafirmthatcanrelocate.Ineachoftwoperiods,thefirmconductsanauctionbetweentworegionsbiddingforitsplant.Kingetal.（1993）extendthemodelsothatgovernmentscanbuildinfrastructurefirstandthenbidinanauctionforafirm.

Severalofthesemodelsallowforuncertainty.Forexample,BlackandHoytexamineuncertaintyabouthowmuchthefirmcanproduceinonesiteratherthananother,andKingandWellingconsideruncertaintyoverthesunkcostofbuildingtheplant.Thecontributionthatourarticletriestomaketothisliterature,however,focusesonheuncertaintyofpotentialhostsabouttherelativevalueoftheirplantsites.

Thatafewcountriesnowcompeteforafootloosefirmisthemainpointofdepartureforouranalysisofuncertainty.Inparticular,webranchfromtheworkthattreats,asparamount,theuncertaintythataffectsbargainingbetweenthefirmanditschosenhost.Webranchfromthisworkbecause—unlessitisenrichedbymoretheory—someofitsmainimplicationsmaynolongerdescribesowelltheworldthatweknow.

Forinstance,Vernon（1971）considersapoorcountrythatdiscoversadepositofrawmaterial.Thecountrydoesnotknowhowtoexploitthedeposit,soitsellsexploitationrightstoaforeign-ownedfirm,anditdoessocheaplybecauseitmustcompensatethefirmfortakingarisk.Thehostinvitesinthefirmpartlytolearnhowitexploitstherawmaterial.Oncethehostlearns,itwillclaimforitselftheprofitsfromfutureexploits.Vernonesquetheorythusimpliedthat,overtime,aspoorcoun-trieslearnedmoreofthetechnologyoftheforeignfirmsontheirsoil,theywouldtakeovermoreofthem.

Bythelate1980s,however,thewaveofnationalizationsintheThirdWorldhadebbed,eventhoughtherewerestillplentyoffirmstoseize,asAnderssonfoundin1991.Where,forallitspower,mightVernonesquetheoryhavegoneastray?

Wesuspectthatamissingpieceofthepuzzleisthathostsnowcompeteforafirmwhentheyareunsureofitslocationcosts.Seizingafirmtodaycanhurtthechancesofapotentialhostinthecompetitionforanotherfirmtomorrowifthehostdoesnotknowhowmuchtoofferthesought-afterfirmtooffsettheincreaseinitscostexpecta-tionofcoststhatwouldresultfromtheearlierseizure.

Generally,thehostcannotbesureofhowmuchtoofferthefirmtolocateinitsborders,largelybecauseitcannotpreciselyestimatethepolitical,social,andculturalcoststhatthefirmwouldfaceinforeignproduction.Suchcostsdonotfitcomfortablybeneaththemeasuringrodofmoney.Whilesuchintangiblecostsmayvarywiththefirm’slevelofphysicalcapital,theydonottypicallyvarywithitsscaleofproduction.Andsotheanalysiswilltreatpolitical,social,andculturalcostsasintangiblefixedcosts.

Firmsappeartoshunnationsthatarepoliticallyorsociallyinstable.Stevens（1969）aswellasSchneiderandFrey（1985）haveprovidedstatisticalevidenceofthispoint,andPfeffermann（1992）hasdrawnuponWorldBankexperience.

Sincesuchfixedcostsaspoliticalinstabilitymattertothefirm,theyalsomattertothehost.Inparticular,thefirm’sestimateofintangiblefixedcostsmatterstothehost,yetithastroubleinferringthiscostestimate,inlargepartbecauseitlacksthefirm’sindustrialexperience.Forinstance,thefirmknowsmorethanprospectivehostsaboutthevaluethattheplantandequipmentwouldaddtoitsoperations.Thefirmcanthusestimatethecosttoitofaseizureofcapitalmorepreciselythanprospectivehostscan.

Weinvestigatehowtwocountriescompeteforafirmwhentheyareunsureofitsfixedcostsoflocation.Giventhisuncertainty,eachcountrydeterminesthesizeofThesubsidythatitwouldofferthefirmtooccupyitssite.Thisdeterminationisstrategic,sincethecountryconsidersthesubsidythatitsrivalwouldofferthefirm.AlthoughThecountriessharethesamebeliefsaboutthevaluesoftheirsites,thesitesthemselvesdiffer.Todescribethesitesasdifferentiatedproductsofferedbycountries,wedrawuponindustrialorganizationmodels,especiallythatofPerloffandSalop（1985）.Section2beginsbyanalyzingcompetitiveoffersofsubsidiesbycountriesthataresureofsitevalues.Thiscaseyieldsabenchmarkbywhichtojudgetheeffectsofuncertaintyonincentives—thecasethatweconsidernext.Theaimoftheanalysisistoguideanempiricalstudy,andSection3considersempiricalimplicationsthatonemaytest.

2.Conclusionsandreflections

Thissimplemodelofcompetitionbetweentwohostcountriesforaforeignfirmsuggeststhatlargesubsidiesareextraneousforthecountrywiththelargermarketorthebetterinfrastructure.Thatfindingisbroadlyconsistentwithstatisticalworkpub-lishedbyRootandAhmed（1978）.Theycarriedoutamultiplediscriminantanalysisofthreegroupsofdevelopingcountries.Thegroupsdifferedfromonean