TECHNOLOGICAL CAPABILITIES OF COUNTRIES, FIRM RIVALRY AND FOREIGN DIRECT-INVESTMENT

Studies on foreign direct investment (FDI) have concentrated on sector al effects, but rarely on country patterns, In this paper, we use U.S. Department of Commerce data to identify the largest country shares of new FDI entries into the U.S. and the technological motivations for t heir investments, Based on the technological intensities of major inve sting countries in manufacturing industries, we conclude that technolo gical industries attract a disproportionate share of FDI entries, Howe ver, the acquisition of U.S. technology is not a major motivation, The findings indicate that industry rivalry is an important dimension to understanding FDI.