Last year,outlays by foreign direct investors to acquire or establish businesses in the United States surged to $201.0 billion, 2 1/2 times the previous record of $79.9 billion set in 1996 and almost triple the 1997 level of $69.7 billion ( table 1 and chart 1). The 1998 outlays were boosted by two exceptionally large acquisitions, each of which significantly exceeded the size of any previous single investment. However, even without these two investments, outlays were still about 40 percent higher than those in 1996.
A new data set on foreign–owned establishments supports an analysis of regional patterns of foreign direct investment in the United States (FDIUS) that uses comprehensive establishment data and is based on geographic areas that are defined on an economic basis rather than on a strictly political or administrative basis. A key feature of the data set is the separate identification of newly built, or “greenfield,” establishments. Greenfield establishments are of particular interest in the analysis of FDIUS because they indicate explicit locational choices by the foreign owners at the time of the investment.