Multinationals and regional indigenous development

We investigate in how far foreign multinationals have fostered regional indigenous development in Ireland. Specifically, we examine whether foreign presence has induced indigenous plant entry within the same regions and in bordering regions. To this end we employ an entry rate model on an exhaustive panel level data set for Irish manufacturing plants. Our results show that multinationals can foster local development both within and in surrounding regions, although the extent of these effects varies between policy preferential and non-preferential regions.Received: December 2002/Accepted: January 2004This research has benefited from financial support through the RTN research project Specialization versus diversification: the microeconomics of regional development and the spatial propagation of macroeconomic shocks in Europe of the European Commission (grant No. HPRN-CT-2000-00072). We would like to thank Rosella Nicolini for helpful comments. The second author gratefully acknowledges financial support from the Belgian FNRS and the third author acknowledges support from a Marie Curie grant. Usual disclaimers apply.