Would Number of Firms Affect Agglomeration of Horizontally FDI in the Host Country?

Abstract

Under assumption of labor force relatively overmuch, this paper investigates agglomeration of horizontally FDI in host country in view of limited number of firms or much enough number of firms. The research indicates: Number of firms will affect agglomeration of horizontally FDI in the host country; horizontally FDI won't invest and agglomerate in host country under the market construction of firm's number much enough, horizontally FDI would invest and agglomerate in host country only under the market construction of firm's number limited. Rapid increases of economy and huge scale of market are important factors for the host country to attract horizontally FDI. The adjustment of industrial structure, growing up of market and gathering of technology power in the host country, which will be beneficial to acquire more horizontally international direct investment for the host country.