Do domestic firms benefit from the presence of multinational enterprises? The case of the Italian manufacturing sector

Foreign direct investment (FDI) from Multinational Enterprises (MNEs) can generate positive externalities to host countries, increasing domestic firms' productivity. Recently, the attention of researchers has moved from the analysis of "horizontal" spillovers - i.e. those benefits to local enterprises at an intra-industrial level towards the investigation of "vertical" spillovers phenomenon - i.e. the diffusion of positive effects on domestic economies at an inter-industry level. Using a firm-level panel data, authors investigate the presence of both kinds of spillovers in the Italian manufacturing sector. The results show the total lack of "horizontal" spillovers and. at the same time, the presence of "vertical" ones.