An analysis of the intra-firm sales activities of Japanese multinational enterprises in the United States: 1977 to 1989

Abstract

This paper examines the activities of the largest Japanese multinational enterprises (MNEs) operating in the United States by looking at data on exports, imports, and intra-firm trade between the Japanese subsidiaries in the United States and their parent and other foreign groups. It also examines how much of the domestic sales in the United States are accounted for by local production of the Japanese subsidiaries. Sales data provide an indication of the advantages of being multinational, which are mirrored in the growth of the post-investment sales of overseas units (both manufacturing and non-manufacturing). Data on the flows and stocks of foreign direct investment (FDI) represent the initial decisions to undertake FDI and largely ignore the learning effects of having overseas production.