Chapter

The Impact of the Completion of the European Internal Market on FDI

John H. Dunning

in Regions, Globalization, and the Knowledge-Based Economy

Published in print March 2002 | ISBN: 9780199250011
Published online November 2003 | e-ISBN: 9780191596216 | DOI: http://dx.doi.org/10.1093/0199250014.003.0007
 The Impact of the Completion of the European Internal Market on FDI

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The impact of the completion of the European Internal Market Programme (IMP) on the geographical distribution of economic activity within the European Community (now Union) is considered. More particularly, the empirical validity of a number of hypotheses, drawn from foreign direct investment (FDI) theory, on the likely effect of the removal of tariff barriers on intra‐EC and extra‐EC trade and FDI flows and the relationship between the two are considered. The evidence strongly suggests that the twin forces of regionalization and localization have been accelerated by recent European integration, and that the balance between the two is strongly determined by the knowledge intensity and mobility of the economic activities involved.

Keywords: economic activity; European Community; European Internal Market; European Union; foreign direct investment; geographical distribution; knowledge‐based economy; localization; regionalization; tariff barriers

Chapter.  18137 words. 

Subjects: International Economics

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