Japanese multinationals in Asia: Drivers and attractors

Ashoka Mody, Susmita Dasgupta, Sarbajit Sinha

Research output: Contribution to journalArticlepeer-review

30 Scopus citations

Abstract

This paper studies the choice by Japanese multinationals of Asia and of specific Asian countries as investment destinations. High costs in Japan exert a general push towards investing in Asia. Unlike investment in the US and Europe, trade barriers do not drive Asian investment. While domestic markets of host countries are important, conditions for efficient production in the host country also determine its attractiveness. In Asia, firms have looked for industrially literate workers, though the new Japanese investment is being guided more by low wages. Japanese investors also stake out early positions in growing markets. The inability to repatriate earnings is the strongest disincentive to Japanese investment. A favourable foreign direct investment policy is desirable but its importance declines as a firm gains experience in a country.

Original languageEnglish (US)
Pages (from-to)149-164
Number of pages16
JournalOxford Development Studies
Volume27
Issue number2
DOIs
StatePublished - 1999
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Geography, Planning and Development
  • Development

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