Profitability and International Linkages in the Spanish Economy
(1980) , 19 pages
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- Abstract
- We investigate the impact of foreign competition on the profitability of the largest firms in Spain over the period 1973-1975, The empirical findings are the following. A foreign participation of 40 percent insures foreign control. Foreign firms have more degrees of freedom with respect to local market structure and international linkages, than domestic firms. Foreign direct investment does not have a negative infant industry effect, rather it has a positive spillover effect on domestic firms. Foreign and domestic firms exercise mutually countervailing power. We conclude that foreign competition increases the allocative efficiency of the Spanish industrial sector.
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Citations
Donsimoni, M.-P., & Leoz-Arguelles, V. (1980). Profitability and International Linkages in the Spanish Economy (Working Papers Institut des sciences économiques 8003). https://hdl.handle.net/2078.5/278816