INVESTMENT PATTERNS AND THE COMPETITIVENESS OF GREEK REGIONS

This paper aims at mapping and analyzing the determinants of industrial activity in Greek regions in order to assess current investment patterns. For this purpose, we estimate a conditional logit model of 226 new established firms for 1996 and 1997. Results give interesting insights that are likely of particular importance to regional policy makers. Noteworthy is the spatial concentration of firms in different prefectures while the large metropolitan cities, Athens and Thessalonica, although with declining shares, prevail as the dominant hosts. European regional policy seems to enhance firms'entry via its effect on economic development variables, in contrast with the Greek Development Law, which turns out non-influential.     

Intra Eurozone Foreign Direct Investment and Deflation

After the recent economic turmoil, besides the severe recession that hit most European Union (EU) countries, and the resulting downward trend in inflation, foreign direct investment (FDI) levels in certain EU countries have bounced back. Hence, we evaluate the effect of deflation on intra-Eurozone FDI. Even though deflation tends to cause a negative effect on investment, low production cost opportunities may arise, thus attracting inward FDI. Using panel data that span from 2003 to 2015, we initially estimate an FDI equation that incorporates deflation as a pre-determined variable and, consequently, a two-equation model that treats both FDI and deflation as endogenous variables. Our results suggest that deflation in periphery Eurozone countries does not deter FDI flows from core to periphery Eurozone countries.     

The Growth Effects of National Patent Policies*

We construct a two‐country (innovative North and imitating South) model of product‐cycle trade, fully endogenous Schumpeterian growth, and national patent policies. A move towards harmonization based on stronger Southern intellectual property rights (IPR) protection accelerates the long‐run global rates of innovation and growth, reduces the North–South wage gap, and has an ambiguous effect on the rate of international technology transfer. Patent harmonization constitutes a suboptimal global‐growth policy. However, if the global economy is governed by a common patent policy regime, then stronger global IPR protection: (a) increases the rates of global innovation and growth; (b) accelerates the rate of international technology transfer; and (c) has no impact on the North–South wage gap.     

Complements or substitutes? New theoretical considerations and empirical evidence on the imports and FDI relationship in Central and Eastern European Countries

This paper addresses the imperative need to understand the relationship between inward FDI and trade by developing a new conceptual approach and providing empirical evidence. We use an expanded time dataset, from 1992 to 2008 and an enriched dataset of countries, sectors and location factors. In regards to the inward FDI versus imports relationship, results comply with our theoretical formulation and strongly indicate an overall complementarity with each other. In the case of FDI we find strong locational characteristics such as the large market size, the gradual improvement of the macro-environment and finally the quality of labour force to play a positive role.     

Escapism FDI from developed economies: The role of regulatory context and corporate taxation

In this paper, we extend the conceptualisation of escapism Foreign Direct Investment (FDI) holding for emerging economies to developed economies that face specific institutional failures, such as weak or incomplete regulations, along with high taxation. We combine this literature with the recent development of Dunning’s eclectic paradigm, which includes institutional aspects regarding location factors. We argue that in developed economies with problematic regulations and high taxation, sound institutions and lower tax rates abroad are extremely significant for domestic firms’ internationalisation. A central result regards the moderating effect of host regulatory quality on taxation, which highlights the crucial role of institutions for firms originating in developed economies that lack sound institutions. Additionally, the results challenge the available theorising and evidence on the moderating role of institutions in the prior experience of a firm at a location. We instead provide evidence that once firms establish a subsidiary abroad, they acquire substantial knowledge about the host institutional environment, which translates into an Ot advantage, providing an additional motive for further expansion. This work uses a unique database of the total population of Greek MNEs – released for the first time – for an extended time period, 2001–2010. The results could be generalised to similar developed economies facing analogous regulatory failures and high taxation, such as the southern European Union countries, as well as even for northern European Union countries, such as Germany, according to Bundesbank’s report.     

FIRM LOCATION: FIRM COMPETENCES,FINANCIAL STRUCTURE AND REGIONAL DETERMINANTS

This paper examines the choice of firms to locate in particular regions based on an expanded set of decision making determinants which takes into consideration firm profiles and competences, firm characteristics with particular emphasis on their financial structure and attractive regional factors focusing on knowledge. It combines intuitions from industrial economics, spatial analysis, corporate finance theory and strategic management to explore in greater depth the location of entrepreneurial activities at the sub‐national level of regions, in particular between large urban areas and the periphery. Results suggest that the firm competences are conducive to their location and that other firm attributes contribute to this decision. When regional development and technological sophistication is taken into account, it is evidenced that they act as catalysts to the above decision, though only with respect to metropolitan regions where economies of scale could be exploited.     

Resources,home institutional context and SMEs’ exporting: Direct relationships and contingency effects

Research highlights the role of resources in SMEs’ exporting but is less forthcoming with respect to entrepreneurial perceptions of home institutional quality. Drawing on institution-based lenses, we distinguish among formal, informal, and regulatory institutions, which in concert with firm resources are expected to influence SMEs’ export behavior. Our predictions are tested on a sample of 150 firms located in Greece. The analysis of direct relationships shows that formal and informal institutional dimensions affect significantly, but differently, SMEs’ export activity. The analysis of interaction effects demonstrates that resource decisions for exporting are contingent upon entrepreneurial perceptions of the home institutional context, such that SMEs respond to formal and informal domestic institutional weaknesses by intensifying resource allocations to fuel export sales. In an opposite direction, export regulatory complexity reverses the positive resources-exporting link. These findings suggest the importance of home institutions in the exporting field.     

Human capital,skills and competencies: Varying effects on inward FDI in the EU context

The primary objective of this paper is to provide a comprehensive investigation on the role of human capital, skills and competencies in the location of inward FDI by comparing Western (EU15) and Central and Eastern (CEE) European Union (EU) members. We go beyond existing studies by examining an extensive list of traditional and newly advanced measures capturing human capital, even differing schooling systems as well as skills and competencies. We assess, for the first time in the FDI literature, vocational vs. general education, following the Vocational and Educational Programs of the EU as well as quality human capital aspects as captured by international scores. Results indicate a major difference regarding theoretical and vocational education programs for both sub-regions; in addition, a major difference is obtained for particular qualifications in international scores. There is evidence for potential internal and external inefficiency in education in CEE countries in contrast to the EU15, which calls for re-evaluation and re-structuring in their education system towards more efficient use of funds; this would earn investors’ trust and meet labor markets’ demands, thus stimulate more and higher value added foreign investments. Results also point to useful implications for managers who should watch closely education reforms.