Grossman, Gene M. <br/><br/>
Optimal Integration Strategies for the Multinational Firm / 
Gene M. Grossman, Elhanan Helpman, Adam Szeidl. 
 - Cambridge, Mass.  National Bureau of Economic Research  2003. 
 - 1 online resource:  illustrations (black and white); 
 - NBER working paper series  no. w10189 .
 - Working Paper Series (National Bureau of Economic Research)  no. w10189. .
<br/><br/> December 2003. 
<br/><br/> We examine integration strategies of multinational firms that face a rich array of choices of international organization. Each firm in an industry must provide headquarter services from its home country, produce intermediate inputs, and assemble the intermediate goods into final products. Both production of intermediate goods and assembly can be performed at home, in another  Northern' country, in the low-wage  South,' or in several of these locations. We study the equilibrium choices of firms that differ in productivity (and thus size), focusing on the role of industry characteristics such as the fixed costs of foreign subsidiaries, the cost of transporting intermediate and final goods, and the share of the consumer market that resides in the South in determining optimal integration strategies. 
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