LIFE DURATION OF FOREIGN MULTINATIONAL SUBSIDIARIES - EVIDENCE FROM UK NORTHERN MANUFACTURING-INDUSTRY 1970-93

Duration analysis is employed to examine the survival of 252 foreign m anufacturing plants in the UK Northern region during 1970-93. Contrary to expectations, the hazard function is approximately inverse quadrat ic rather than monotonic decreasing. Greenfield entrants face a lower risk of failure than acquisition entrants, particularly early in life. Acquisitions of older plants exhibit stronger survival than acquisiti ons of recently established plants, so that the age of (indigenous) ac quired plant at the point of foreign takeover appears to matter to the survival of acquisition entrants. Plant size and industrial concentra tion also emerge as important. Home country of parent firm and locatio n within region are unimportant. Consistent with the inverse U-shaped hazard function, the lognormal regression model provides a reasonably satisfactory fit to the data, certainly tighter than the Weibull model . (C) 1998 Elsevier Science B.V. All rights reserved.