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The relationship between inward investments and local firms' productivity is contingent on several contextual conditions that collectively define the ability of firms and regions to recognise, assimilate and commercially apply external knowledge. Yet the empirical literature has been unable to account efficiently for such multidimensional sources of heterogeneous externalities. We introduce a novel two-stage empirical methodology that allows accounting for a wide range of moderating circumstances. Relying on a sample of 11,000 UK firms over the period 2012–2018, we show that while the nature of places affects the potential externalities from multinational enterprises (MNEs), what matters more are firm-level characteristics. This has important implications for regional policy, particularly in understanding the drivers of inequality, both within and across regions. [ABSTRACT FROM AUTHOR]

Copyright of Regional Studies is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Regional Studies is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)