New evidence on the link between exchange rates and asset-seeking acquisition FDI

Blonigen (1997) proposes a link between exchange rates and foreign direct investment (FDI) motivated to acquire complementary assets (i.e., asset-seeking acquisition FDI). However, previous studies have only examined this hypothesis with acquisition FDI data from a country source that are mostly U.S. inbound. In this paper I examine the hypothesis using the acquisition FDI data from multiple country sources that are inbound for various countries. I find evidence in support of this hypothesis for U.S. inbound acquisition FDI from multiple country sources, but not inbound acquisition FDI for other various developed countries.

► I re-examine Blonigen's (1997) hypothesis using the acquisition FDI data from multiple country sources that are inbound for various countries. ► I find evidence in support of this hypothesis for U.S. inbound acquisition FDI from multiple country sources. ► I do not find evidence in support of this hypothesis for inbound acquisition FDI for other various developed countries.