Foreign firm entry in an open economy: the case of Portugal

• Type: Article in International Scientific Journal
• Date: 2004

Authors

Barbosa, N (Author) Other; Paulo Guimaraes (Author) Other; Woodward, D (Author) Other

Journal

Title: Applied Economics

Vol. 36

Pages: 465-472

ISSN: 0003-6846

Publisher: Taylor & Francis

Indexing

ISI Web of Knowledge - 21 Citations

Scopus - 25 Citations

Scientific classification

FOS: Social sciences > Other social sciences

Other information

Authenticus ID: P-000-B6Q

DOI: 10.1080/00036840410001682160

Abstract (EN): The purpose of this paper is to analyse the entry process of foreign direct investment (FDI) in Portuguese industrial sectors. Portugal presents an interesting case where firms enter to take advantage of export opportunities. The results suggest that foreign firms possess the ability to overcome existing entry barriers that affect domestic firms. Apparently, foreign firms have different expectations about profitability than domestic firms, possibly due to foreign firms' export-orientation to the rest of the European Union (EU). They appear to desire industries where other foreign firms have clustered. Above all, it appears that these foreign firms enter industries to exploit Portugal's chief location advantage in Western Europe: low wages. Portugal's FDI experience is relevant to other countries that have opened their economies to greater trade and investment and attracted export-oriented firms.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 8