This article is the first to explore the determinants of international relocation of a firm. It is found that labour intensive firms in a highly industrialized and open economy such as Belgium tend to relocate more to other countries than their highly productive capital intensive counterparts. Access to a global network, firm size, and the rate of innovation have a positive effect on the probability of relocation. Uncertainty has a negative impact on the probability of relocation. The positive effect of firm size and profitability on the relocation decision is clearly distinct from its effect on the exit decision of a firm.

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Economics Letters
Erasmus School of Economics

Pennings, E., & Sleuwaegen, L. (2000). International Relocations: firm and industry determinants. Economics Letters, 179–186. doi:10.1016/S0165-1765(99)00269-4