Temporary Investment Incentives and Divestment by Foreign Firms

Details

Serval ID
serval:BIB_AA5877A00AA5
Type
Inproceedings: an article in a conference proceedings.
Publication sub-type
Abstract (Abstract): shot summary in a article that contain essentials elements presented during a scientific conference, lecture or from a poster.
Collection
Publications
Title
Temporary Investment Incentives and Divestment by Foreign Firms
Title of the conference
Academy of Management Proceedings
Author(s)
Mata J., Guimaraes P.
Publisher
The Academy of Management
ISSN
0065-0668
1543-8643
Publication state
Published
Issued date
01/01/2013
Peer-reviewed
Oui
Volume
2013
Number
1
Pages
13919-13919
Language
english
Abstract
Many countries provide temporary incentives for attracting foreign investment, in the belief that these temporary benefits may entice these firms to remain in the country. Using a unique data set on U.S. firms that were established in Puerto Rico under a temporary investment incentive program, we are able to evaluate the impact of terminating or reducing these benefits upon the exit decision by these firms. The program contemplated different benefit schedules in different locations and reduction of benefits every five years. Our results indicate that whenever benefits are reduced the probability of firm exit increases. This effect is more pronounced for firms coming from countries which are well acquainted with the host country, for firms making less sunk investments and those investing in areas that do not grow much.
Create date
15/02/2018 11:35
Last modification date
20/08/2019 15:14
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