Abstract
This paper empirically examines the impacts of exchange rate volatility on the location choice by Japanese multinational corporations (MNCs) and their intra-firm trade. We use affiliate-level data for Japanese MNCs for 1995, 1998 and 2001. We found that high exchange rate volatility discourages the establishment of an affiliate by MNCs. Moreover, the high exchange rate volatility causes the shift from inter-firm to intra-firm transactions. These findings imply the importance of maintaining a stable exchange rate environment in order for MNCs to expand their production and distribution networks.
| Original language | English |
|---|---|
| Pages (from-to) | 523-538 |
| Number of pages | 16 |
| Journal | Singapore Economic Review |
| Volume | 53 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2008 |
| Externally published | Yes |
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Keywords
- Exchange rate volatility
- Intra-firm trade
- Location choice
ASJC Scopus subject areas
- Economics and Econometrics
Cite this
Exchange rate volatility and MNCs' production and distribution networks : The case of Japanese manufacturing MNCs. / Kiyota, Kozo; Matsuura, Toshiyuki; Urata, Shujiro.
In: Singapore Economic Review, Vol. 53, No. 3, 2008, p. 523-538.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Exchange rate volatility and MNCs' production and distribution networks
T2 - The case of Japanese manufacturing MNCs
AU - Kiyota, Kozo
AU - Matsuura, Toshiyuki
AU - Urata, Shujiro
PY - 2008
Y1 - 2008
N2 - This paper empirically examines the impacts of exchange rate volatility on the location choice by Japanese multinational corporations (MNCs) and their intra-firm trade. We use affiliate-level data for Japanese MNCs for 1995, 1998 and 2001. We found that high exchange rate volatility discourages the establishment of an affiliate by MNCs. Moreover, the high exchange rate volatility causes the shift from inter-firm to intra-firm transactions. These findings imply the importance of maintaining a stable exchange rate environment in order for MNCs to expand their production and distribution networks.
AB - This paper empirically examines the impacts of exchange rate volatility on the location choice by Japanese multinational corporations (MNCs) and their intra-firm trade. We use affiliate-level data for Japanese MNCs for 1995, 1998 and 2001. We found that high exchange rate volatility discourages the establishment of an affiliate by MNCs. Moreover, the high exchange rate volatility causes the shift from inter-firm to intra-firm transactions. These findings imply the importance of maintaining a stable exchange rate environment in order for MNCs to expand their production and distribution networks.
KW - Exchange rate volatility
KW - Intra-firm trade
KW - Location choice
UR - http://www.scopus.com/inward/record.url?scp=58149469959&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=58149469959&partnerID=8YFLogxK
U2 - 10.1142/S0217590808003087
DO - 10.1142/S0217590808003087
M3 - Article
AN - SCOPUS:58149469959
VL - 53
SP - 523
EP - 538
JO - Singapore Economic Review
JF - Singapore Economic Review
SN - 0217-5908
IS - 3
ER -