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Multinationals Assist Domestic Suppliers? Perhaps Think Again

voxeu.org

The positive spillovers from multinationals to the productivity of their host-country suppliers are empirically well established. Usually, it is assumed that multinationals aid their suppliers by voluntarily sharing knowledge and cooperating with them. This column argues the spillovers might rather result from blunt pressure by the multinationals, forcing their suppliers to adopt new practices and to adapt to new standards.

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