Home-Country Measures to Support Outward Foreign Direct Investment: Variation and Consequences

The state, especially in emerging economies, plays a key role in influencing firm behaviour, including outward foreign direct investment (OFDI). The existing literature on the state’s influence on OFDI often stresses direct state ownership. However, the state can influence OFDI in several ways, including policy support and subsidies; the existing literature has largely overlooked these effects. We build on key insights from the comparative capitalisms literature to put forward a series of propositions on how different home country measures – in both emerging and developed economies – to boost OFDI will influence, inter alia, the volume, location and mode of firms’ investments abroad. We, therefore, contribute to the literature by highlighting how government policies across a wide range of countries influence an important aspect of firm behaviour that has economic, social and environmental implications.