1 Discussion by Gianpaolo Rossini Of : Productivity, multinationals and Knowledge spillovers: evidence from the UK retail sector. By M.D. Aňon Higon and N. Vasiliakos

2 Object Evaluation of potential benefits of foreign owned establishments in the British retail sector, due to a) increased competition b) spillovers.

3 State of the art Few studies on the effect of FDI on the retail sector. Many studies on other sectors Methods: evaluation of productivity effects of presence of FDI

4 Results Positive effects of FDI on the productivity of local firms which are MNF. But much it depends on absorptive capacity -> how far is the firm that should benefit. Only efficient firms benefit from spillovers from other effcient firms. Effects are mostly local (less than regional).

5 Questions 1. British MNFs are the most efficient. It is akward to understand the positive effect of non British MNFs on remaining firms, once you recognize superior performance of British MNFs 2. Use of Herfindahl index at sector level and market share (firm level) to capture competition…???? Why should FDI make a market more competitive? May be other indicators could be added. Or used instead.

6 Final comments Local spillovers have compensated the destructive effects of competition in terms of productivity gains.??? POLICY Implications: attract foreign investors to reduce productivity gap in the British retail industry (you mean in the Non MNF British firms?). Does Britian need FDI in retail?