TY - BOOK AU - McCaig,Brian AU - Pavcnik,Nina AU - Wong,Woan Foong ED - National Bureau of Economic Research. TI - FDI Inflows and Domestic Firms: Adjustments to New Export Opportunities T2 - NBER working paper series PY - 2022/// CY - Cambridge, Mass. PB - National Bureau of Economic Research KW - Trade Policy • International Trade Organizations KW - jelc KW - Empirical Studies of Trade KW - Industrialization • Manufacturing and Service Industries • Choice of Technology KW - International Linkages to Development • Role of International Organizations N1 - December 2022; Hardcopy version available to institutional subscribers N2 - We investigate the long-term effects of export opportunities to a large destination market on multinational affiliates and domestic firms in a low-income host country. The US-Vietnam Bilateral Trade Agreement reduced US import tariffs on exports from Vietnam. Tariff reductions led to entry of foreign and private firms and to employment expansion in formal manufacturing, with foreign entrants contributing most to employment growth. State firms stall employment reallocation through slower contraction. Half of tariff-induced foreign entrant growth is post-entry and exporter-driven. Foreign entrants are from non-US sources, highlighting the importance of studying FDI from multiple source countries in a lower-income host UR - https://www.nber.org/papers/w30729 UR - http://dx.doi.org/10.3386/w30729 ER -