University of Groningen The Role of Multinational Enterprises in the Transition Process of Central and Eastern European Economies Marek, Philipp IMPORTANT NOTE: You are advised to consult the publisher's version (publisher's PDF) if you wish to cite from it. Please check the document version below. Document Version Publisher's PDF, also known as Version of record Publication date: 2015 Link to publication in University of Groningen/UMCG research database Citation for published version (APA): Marek, P. (2015). The Role of Multinational Enterprises in the Transition Process of Central and Eastern European Economies. Groningen: University of Groningen, SOM research school. Copyright Other than for strictly personal use, it is not permitted to download or to forward/distribute the text or part of it without the consent of the author(s) and/or copyright holder(s), unless the work is under an open content license (like Creative Commons). Take-down policy If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately and investigate your claim. Downloaded from the University of Groningen/UMCG research database (Pure): http://www.rug.nl/research/portal. For technical reasons the number of authors shown on this cover page is limited to 10 maximum. Download date: 22-03-2019
Appendix A.2 Regional Determinants of MNE s Location Choice in Post-Transition Economies A.2.1 Specification of the Coefficients of the Empirical Function The profit function π jk = (1 t j ) [ (σ 1) σ 1 ( ((1 + τj )w jk ) γ ) 1 γ r 2 γ j d 3 δ j S 1 δ jk T 2 δ j H 3 δ 1 σ j E 4 j σ σ M m=1 ] σ 1 MA m σ 1, φ jm can be transformed by taking logs into the following log-linear empirical function with an error term, e jk : ln π jk = (σ 1) ln (σ 1) σ ln σ + ln (1 t j ) + γ 1 (1 σ) ln (1 + τ j ) }{{}}{{}}{{} β 0 β 1 ln t j β 2 ln τ j + γ 1 (1 σ) ln w jk +γ 2 (1 σ) ln r j +γ 3 (1 σ) ln d j +δ 1 (1 σ) ln S jk +δ 2 (1 σ) ln T j + }{{}}{{}}{{}}{{}}{{} β 3 β 4 β 5 β 6 β 7 ( M δ 3 (1 σ) ln H j + δ 4 (1 σ) ln E j + (σ 1) ln }{{}}{{}}{{} m=1 β 8 β 9 β 10 ) MA m + e jk. φ jm The definitions of the coefficients above lead to the profit function serving as the foundation for the empirical analysis. π jk = β 0 + β 1 ln t j + β 2 ln τ j + β 3 ln w jk + β 4 ln r j + β 5 ln d j + β 6 ln S jk + β 7 ln L jk + β 8 ln H j + β 9 ln E j + β 10 ln ( M m=1 ) MA m + e jk. φ jm 163
A.2.2 Tables Table A.1: The 33 NUTS-2-regions included in the dataset ID Country NUTS-2 Region Industry Service 1 East Germany DE30 Berlin 81 523 2 East Germany DE41 Brandenburg - Nordost 39 40 3 East Germany DE42 Brandenburg - Südwest 60 73 4 East Germany DE80 Mecklenburg-Vorpommern 59 85 5 East Germany DED1 Chemnitz 56 35 6 East Germany DED2 Dresden 100 67 7 East Germany DED3 Leipzig 28 60 8 East Germany DEE0 Sachsen-Anhalt 115 91 9 East Germany DEG0 Thüringen 109 89 10 Czech Republic CZ01 Praha 39 244 11 Czech Republic CZ02 Stredni Cechy 32 21 12 Czech Republic CZ03 Jihozapad 50 17 13 Czech Republic CZ04 Severozapad 35 13 14 Czech Republic CZ05 Severovychod 44 19 15 Czech Republic CZ06 Jihovychod 60 53 16 Czech Republic CZ07 Stredni Morava 35 13 17 Czech Republic CZ08 Moravskoslezsko 21 14 18 Poland PL11 Lodzkie 41 45 19 Poland PL12 Mazowieckie 170 585 20 Poland PL21 Malopolskie 30 82 21 Poland PL22 Slaskie 83 79 22 Poland PL31 Lubelskie 16 9 23 Poland PL32 Podkarpackie 12 12 24 Poland PL33 Swietokrzyskie 22 10 25 Poland PL34 Podlaskie 4 3 26 Poland PL41 Wielkopolskie 92 97 27 Poland PL42 Zachodniopomorskie 34 30 28 Poland PL43 Lubuskie 21 10 29 Poland PL51 Dolnoslaskie 111 93 30 Poland PL52 Opolskie 25 13 31 Poland PL61 Kujawsko-Pomorskie 53 20 32 Poland PL62 Warminsko-Mazurskie 11 4 33 Poland PL63 Pomorskie 49 57 Capital regions highlighted in blackface letters. 1,737 2,606 164
Table A.2: Descriptive statistics of the secondary variables Variable East Germany CZ PL Total Relative Agglomeration 0.098* 0.070 # 0.058 # 0.0995 spec (0.124) (0.071) (0.047) (0.0962) Diversification 0.148* 0.095 # 0.122 # 0.122 herf (0.033) (0.029) (0.016) (0.031) Sectoral Wage 34.87* 15.44 # 14.44 # 22.65 wage (15.82) (12.76) (9.754) (16.26) Human Resources 28.21* 28.80 # 20.44 # 24.59 hrsto (4.143) (7.540) (3.357) (6.367) Unemployment Rate 16.53* 7.680 # 15.02 13.70 unemp (2.683) (3.391) (5.205) (5.447) Regional GDP 37794.4* 12194.4 # 15425.0 # 20742.6 gdp (17903.3) (6331.1) (13185.8) (17073.0) Market Potential 14043.5* 13296.9 # 10197.4 # 11997.7 mp (2400.1) (2103.0) (1660.4) (2661.9) Population Density 560.6* 420.5 129.1 # 317.4 popdens (1156.3) (770.1) (75.53) (735.5) Infrastructure-Index 0.889* 0.654 # 0.740 # 0.760 inf (0.446) (0.162) (0.208) (0.298) Corporation Tax 39.81* 27.55 # 23.73 # 30.36 corp (6.984) (4.655) (5.711) (8.988) Tax Wedge 52.99* 43.13 # 42.17 # 46.10 tax (0.762) (0.404) (1.590) (5.069) Patents 183.85* 14.10 # 4.683 # 55.83 patents (163.90) (9.909) (5.493) (116.14) Distance 1656.34* 1432.70 1483.45 1543.2 dist ( 2441.8) (2126.4) (1772.6) (2117.7) Note: Mean of the referring variable above and the corresponding standard error in parenthesis below. =Significant mean difference compared to the Polish and Czech observations; # =Significant mean difference compared to the German observations. All tests refer to a 5% significance level. The mean and the standard error of the regional values are equally weighted over time, except for the relative agglomeration and wages, which are calculated on the base of the observation of the chosen investments. Table A.3: Correlation table of explanatory variables spec herf patent wage hrsto unemp gdp mp corp taxw popd infra dist spec 1 herf.388 1 patent.375.751 1 wage.208.663.673 1 hrsto.340.625.592.583 1 unemp -.030.197.221.139 -.340 1 gdp.362.790.844.689.545.226 1 mp.040.035.352.316.395.076.202 1 corptax.202.432.527.425.296.055.363.320 1 taxwed.211.561.699.614.371.383.585.570.781 1 popdens.415.776.831.593.798 -.082.695.158.342.385 1 infra.386.726.867.566.566.101.767.090.327.420.903 1 dist.000.037.038.026.029.077 -.003.029.045.050.061.079 1 165
Table A.4: Conditional Logit for the whole sample and subsamples. whole exclusion of obervations from sample East Germany Poland Czech Republic lnspec 0.780*** 0.720*** 0.883*** 0.823*** (0.034) (0.048) (0.049) (0.039) lnherf -0.260* -0.431* -0.420 0.281 (0.146) (0.257) (0.270) (0.191) lnpatent 0.032 0.040 0.032 0.072** (0.029) (0.033) (0.063) (0.033) capital 0.638*** 0.273* 1.622*** 0.302** (0.098) (0.163) (0.419) (0.127) lnwage 0.603*** 1.012*** 0.670*** 0.800*** (0.083) (0.127) (0.126) (0.096) lnhrsto 0.723*** 0.074 0.788* 0.459* (0.228) (0.270) (0.405) (0.255) lnunemp 0.534*** -0.077 0.543*** 0.556*** (0.084) (0.112) (0.145) (0.123) lngdp 0.903*** 1.154*** 0.809*** 1.036*** (0.063) (0.094) (0.153) (0.067) lnmp 0.422** 0.971*** 0.089 0.465** (0.182) (0.288) (0.284) (0.233) lnpopdens -0.234*** -0.153** -0.480*** -0.375*** (0.051) (0.062) (0.097) (0.089) lncorp 0.823*** -1.820*** 0.957** 2.182*** (0.224) (0.420) (0.455) (0.270) lntax 2.783*** -1.846** -35.884*** 8.515*** (0.550) (0.748) (3.737) (0.712) lninfra 0.363*** -0.132 0.223 0.669*** (0.127) (0.184) (0.161) (0.231) lndist_eu -0.497*** -1.116*** -0.488*** -0.444*** (0.073) (0.117) (0.105) (0.086) lndist_neu 0.122-1.911** -0.777 0.457 (0.507) (0.805) (0.855) (0.542) Investments 4,343 2,633 2,420 3,633 Log-Likelihood -12,829.2-6,901.8-5,697.4-9,460.0 Hausman-Test χ 2 (18) 284.98 202.83 562.98 p-value 0.000 0.000 0.000 Conditional Logit Estimation. Dependent Variable: Location choice for Region j. Standard errors in parentheses: ***p 0.01,**p 0.05,*p 0.1. Country dummies, sectoral dummies and company size included in each regression. Hausman Test for systematic differences between the coefficients of the whole sample and the corresponding subsample. 166
A.3 Agglomeration and FDI in East German Knowledge-Intensive Business Services Table A.5: Regional distribution of KIBS FDI Name of Raumordnungsregion Investments Altmark 4 Anhalt-Bitterfeld-Wittenberg 8 Berlin 386 Halle/S. 27 Havelland-Fläming 33 Lausitz-Spreewald 20 Magdeburg 34 Mecklenburgische Seenplatte 5 Mittelthüringen 28 Mittleres Mecklenburg/Rostock 25 Nordthüringen 1 Oberes Elbtal/Osterzgebirge 48 Oberlausitz-Niederschlesien 12 Oderland-Spree 9 Ostthüringen 35 Prignitz-Oberhavel 13 Südsachsen 20 Südthüringen 9 Uckermark-Barnim 5 Vorpommern 12 Westmecklenburg 8 Westsachsen 47 Total 789 167
Table A.6: Correlation table of explanatory variables (log values) LQ MLI herf patent rnd stud hrsto gdp mp wage tax STune dist LQ 1 MLI -0.222 1 herf -0.212-0.240 1 patent 0.330 0.346-0.276 1 rnd 0.533-0.111-0.299 0.639 1 stud 0.212-0.056-0.028 0.371 0.376 1 hrsto 0.385 0.030-0.084 0.599 0.588 0.360 1 gdp 0.427 0.153-0.228 0.769 0.655 0.458 0.654 1 mp -0.128 0.472-0.107 0.137 0.060-0.254-0.081-0.023 1 tax 0.291 0.219-0.135 0.469 0.442 0.489 0.551 0.724-0.120 1 wage 0.209 0.012 0.052 0.340 0.230 0.125 0.761 0.479-0.026 0.322 1 STunemp -0.115-0.497 0.331-0.513-0.214-0.188-0.334-0.354-0.347-0.235-0.268 1 dist -0.018-0.066 0.041-0.029 0.007-0.001 0.015-0.011-0.039-0.013 0.054 0.050 1 168