U.S.-Owned Affiliates and Host-Country Exports

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Summary

U.S.-owned manufacturing affiliates in foreign countries tended to become more export-oriented between 1966 and 1977. The shift toward exporting characterized affiliates in most industries and most...

U.S.-owned manufacturing affiliates in foreign countries tended to become more export-oriented between 1966 and 1977. The shift toward exporting characterized affiliates in most industries and most countries. The bulk of U.S.-owned production abroad continues to be for local sale in most industries and areas. Exporting to the U.S. remains a small part of affiliate activities in almost all cases. The most export-oriented were subsidiaries in machinery industries in Southeast Asia which were also the only ones outside Canada that sold a substantial part of their production in the U.S. In most industries and most countries U.S.-owned companies led the rise in exports and increased their shares in the exports of their host countries. This role of U.S. subsidiaries was particularly notable in Southeast Asia, and in those countries was concentrated in the machinery industry. The increasing share of U.S. affiliates in host-country exports was quite a general phenomenon, however, and high rates of affiliate export growth were associated with rapid growth of host country GDP and exports.

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