Fritz Foley and Kalina Manova This article surveys rese. Iarch at the intersection of international economics and corporate finance. Recent research illustrates how intern. Iational trade and multinational activity are affect by the crit constraints firms face and by firms ability to make use of internal capital markets. Differences in access to financial capital explain variation in trade participation at the co. Iuntry industry and firm level. Through their internal capital markets multinational firms can raise funding in one location and deploy it elsewhere. Internally available financial capital gives multinationals an advantage over purely domestic firms in some circumstances.
Firms ne to fund fix and variable
Costs of cross border transactions and these transac. Itions often tie up capital for longer periods of time than domestic transactions and involve distinct risks. Crit constraints also play a role in determining which firms choose to conduct operations in multiple countries and what kinds of What have been your experiences How can organizations best handle the brilliant jerk What Ghana Email List do you think To Read More Marcus Buckingham and Curt Coffman First Break All the Rules What the World s Greatest Managers Do Differently New York Simon Schuster especially pp. . John Grossmann Who Is a Destructive Hero The New York Times October p. B . activities they perform in different jurisdictions.
Financial considerations often
Shape the extent to which multinationals generate spillovers for local firms. Key concepts include The ability to access financial capital to pay fix and Australia Telegram Number variable costs affects choices firms make regarding export entry and operations and as a consequence influence aggregate trade patterns. Multinationals may use internal capital markets to pay for fix costs address managerial moral hazard and exploit differences in access to capital across countries.
