Twelfth Global Studies Conference

Abstract

This paper examines the dynamics of the location patterns of foreign direct investment (FDI) subsidiaries in manufacturing and service sectors across regions in a developing economy. The data at the NUTS level 2 on regions in Poland is analyzed employing revealed location advantage (RLA) index for industrial specialization (RLAis) of the regions. Relative industrial sectors’ concentration patterns are revealed along with industrial innovation and specialization level of regions’ participating foreign enterprise units across all regions of Poland. The findings allow determining that the location of foreign firms in service-related industries is concentrating mostly in larger agglomerations with a strong presence of large markets and universities. While, also a number of regions seem to be able to narrow their manufacturing specializations, they generally locate at, or near, the legacy centers of those industrial sectors. This provides answers for, and confirms, the raised hypothesis and generally follows existing theoretical path of the developed economies. The study, also, shows that the regions attracting a higher number of foreign service-related FDI also seem to increase their industrial specialization in select manufacturing sectors and attract R&D investment.