U.S. direct investment in the United Kingdom and national economic objectives

Abstract

The present paper poses two questions with regards to international direct investment and domestic economic policy. Specifically, it asks first, what the contribution to U.K. subsidiaries of U.S. firms to U.K. economic welfare is and, second, what action (if any) might the U.K. Government take - either unilaterally or multilaterally - to ensure that the net benefits of this contribution are maximised? The author makes some general observations regarding these two questions before illustrating the argument more specifically by reference to the impact of U.S. investment on U.K. technology.

JEL: F40, E61, F21