The aim of this paper is analysing the effects on a host economy of the entry of multinational enterprises (MNEs). Our empirical methodology makes use of the computable general equilibrium (CGE) analysis, through an extension of the Global Trade Analysis Project (GTAP) model that includes MNEs. We have paid a special attention to a mostly neglected aspect of the impact of MNEs, namely, profit repatriation. The empirical analysis is applied to the case of the Czech Republic, a country that has received substantial inflows of foreign direct investment in the last few years.
