Foreign Firms And Local Communities
The literature on the effects of Foreign Direct Investment (FDI) and activities of MultiNational Enterprises (MNEs) on host-countries has been almost exclusively focused on issues of productivity, growth and wages. The authors argue that this leaves quite a bit of important unexplored areas of inquiry, particularly those connected with the interactions of local communities and governments with MNEs. As an example, they provide a novel analysis of local corporate philanthropy, which shows significant differences between local- and foreign-owned corporations. They find that foreign-owned enterprises are less likely to give, but that when they do give, it is substantially more in magnitude than domestic firms, everything else equal.