Intra-industry foreign direct investment, uneven development and globalization: the legacy of Stephen Hymer

Nigel Driffield*, James H. Love

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


This paper revisits the issue of intra-industry foreign direct investment (FDI). This issue was considered in Stephen Hymer's early work, but was not subsequently developed, and was largely ignored in the literature for some time. Using the example of the UK, this paper traces the patterns of intra-industry FDI, both across countries and industries, for both the manufacturing and service sectors. Despite the undoubted increase in the integration of goods and factor markets since the time of Hymer's writing, the analysis presented here shows that the pattern has changed little in the last 40 years. The paper then goes on to discuss the motives for intra-industry FDI, relating it to technology flows and factor cost differentials. Finally, we present some analysis relating intra-industry FDI to uneven development, both between developed and developing countries, and between regions of a developed country. It is clear that intra-industry FDI is still very much a developed country phenomenon, as Hymer suggested, with both developing countries and poorer regions of developed countries unlikely to reap any of the benefits. In this context, one-way and two-way FDI must be seen as different phenomena within the debate on globalisation. © The Author 2005. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.

Original languageEnglish
Pages (from-to)55-78
Number of pages24
JournalContributions to Political Economy
Issue number1
Publication statusPublished - Aug 2005

Bibliographical note

This is a pre-copy-editing, author-produced PDF of an article accepted for publication in Contributions to Political Economy following peer review. The definitive publisher-authenticated version Driffield, Nigel L. and Love, James H. (2005) Intra-industry foreign direct investment, uneven development and globalisation: the legacy of Stephen Hymer. Contributions to Political Economy, 24 (1). pp. 55-78. ISSN 0277-5921 is available online at:


  • intra-industry
  • foreign direct investment
  • FDI
  • Stephen Hymer
  • manufacturing
  • service sectors


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