Search results for "Foreign direct investment"
showing 10 items of 121 documents
Welfare, Home Market Effects, and Horizontal Foreign Direct Investment
2005
We investigate the spatial distribution and organization of an imperfectly competitive industry when firms may choose to operate more than a single production unit. Focusing on a short-run setting with a fixed mass of firms, we fully characterize the spatial equilibria analytically. Comparing the equilibrium and the first-best, we show that both organizational and spatial inefficiencies may arise. In particular, when fixed costs are low enough the market outcome may well lead to overinvestment and, therefore, to too many multinationals operating from a social point of view. Furthermore, once multinationals are taken into account, the market outcome may well lead too little agglomeration.
Catching-up to foreign technology? Evidence on the “Veblen–Gerschenkron” effect of foreign investments
2006
Abstract The presence of foreign multinational enterprises may benefit local economies. In particular, highly productive foreign-owned firms may promote the technological catch-up of local firms. This channel of spillovers is defined as the “Veblen–Gerschenkron” effect of foreign direct investment and is analyzed in this article. Rather than the overall concentration of foreign-owned plants in a region or sector, it is their productivity advantage that determines the positive effect on domestic firms in geographical and technological proximity. We test this hypothesis using new firm-level data for German and Italian manufacturing firms during the 1990s. These two countries are particularly …
The Determinants of Foreign Direct Investment and Labor Productivity in the Manufacturing Industry of Vietnam - The Firm-Level Data Evidence
2020
Foreign direct investment (FDI) has become an essential source for the economic growth and development of many developing countries. FDI can deliver financial capital, a strategic way to access the global market, a channel to transfer technology and skills to the host country. Many developing countries pay attention to attracting FDI as an important issue. The first objective of this study is to investigate the determinants of FDI in the manufacturing industry in Vietnam by finding out the differences in characteristics between FDI and local enterprises and then examining the business climate factors which affect the operations of foreign-invested firms. Finding the importance of export and…
Foreign Direct Investments and the Rule of Law in Africa in the context of legal integration
2019
This essay focuses on the relationship between foreign direct investment (FDI) and the rule of law in the context of legal integration in Africa, outside of the AfCFTA agreement. Specifically, the essay investigates the concept of the rule of law, taking into account its ‘dynamic’ side, that is the power to shape and model the structure of a state using the example of OHADA. The OHADA framework shows that the relationship between foreign direct investment (FDI) and the rule of law is not unilateral but a ‘two-way mutual’ relationship where both actors contribute to the success of the system, adapting to each other in order to achieve their respective goals.
Current Account Adjustment and Retained Earnings
2018
This paper develops a formal strategy to calculate current accounts with retained earnings (RE) on equity investment and analyzes their adjustment during the global financial crisis. RE are the part of companies' profits which are reinvested and not distributed to shareholders as dividends. International statistical standards treat RE on foreign direct investment and RE on portfolio investment differently: while the former enter the current and financial account, the latter do not. We show that this differential treatment strongly affects current accounts of several advanced economies, frequently referred to as financial centers, with large positions in equity (portfolio) investment. Our em…
Quantile regression for the FDI gravity equation
2015
Abstract Firm-level heterogeneity shapes foreign direct investment (FDI) flows, whereby a few firms are responsible for most of the world's FDI. Aggregate outcomes of FDI are highly skewed, and the estimates of FDI's antecedents vary largely depending on FDI level. The incidence of individual firms, however, varies across FDI's quantiles. To study the individual firms' effect on FDI flows, this study develops a quantile regression method for bilateral FDI panel data. This study estimates the differential incidence of individual firm-level projects on aggregate flows among 161 countries from 2003 to 2012. Results suggest that FDI's determinants vary across quantiles. In particular, the effec…
Do Multinationals Deteriorate Developing Countries' Export Prices? The Impact of FDI on Net Barter Terms of Trade
2015
This paper explores the economic relationship between foreign direct investment (FDI) to developing countries and the export prices of the latter, measured by terms of trade. It is rst shown that economic theory suggests such a relationship for various reasons but is inconclusive about the direction of the eect. To address this open issue empirically, I analyze data on more than 50 developing countries throughout the period 1980 - 2008 using robust dynamic panel data methods. The results show that FDI had an economically relevant and statistically signicant positive impact on developing countries’ net barter terms of trade. A higher level of education in the developing country fosters this …
A study of language effects on inward FDI flows in Southeast Asia
2019
Master's thesis Business Administration BE501 - University of Agder 2019 This master thesis explores how language might affectthe yearly flow of foreign direct investment (FDI) towards five Southeast Asian countries: Indonesia, Malaysia, Philippines, Singapore and Thailand. This is aresearch area that has been quite unexplored, and we find it interesting to put forward some hypotheses to observe if there exist such effects or not. By using multiple regression analysison a relevant dataset, three main hypothesesare tested:•Countries in which a global language holds an official status will contribute more FDI than other countries.•Countries that share a global language with a FDI recipient co…
Ārvalstu tiešo investīciju ietekmējošie faktori Latvijā
2015
Bakalaura darba „Ārvalstu tiešo investīciju ietekmējošie faktori Latvijā” galvenais mērķis ir izpētīt ienākošo ārvalstu tiešo investīciju ietekmējošos faktorus Latvijā. Balstoties uz zinātniskajiem pētījumiem, tiek noskaidroti iespējamie faktori, kas ietekmē ĀTI. Viena no darbā izmantotajām metodēm ir MKM daudzfaktoru regresijas analīze. Šajā analīzē tiek izmantoti ceturkšņu dati un aplūkotais periods ir no 2001. gada līdz 2014. gadam. Tiek noskaidrots, ka tirgus lielums, tirgus atvērtība un iegūldījumu atdeve pozitīvi ietekmē ienākošās ĀTI plūsmas Latvijā, kamēr tādi faktori kā inflācija, darbaspēka izmaksas, valūtas vērtība un ĀTI novēlotās vērtības netiek novērtēti kā statistiski nozīmīg…
Developing international social capital: The role of communities of practice and clustering
2019
Abstract One criteria regarding where to invest in foreign markets is linked to the international social capital (ISC) that exists on the place, which enables the access to local knowledge and other location-specific advantages. There are alternative ways to create and make use of that ISC that are still unexplored by International Business literature. In this paper, we study the geographic communities of practice (CoP) that are formed by FDI firms from the same country-of-origin (the so-called country-of-origin clusters). For that purpose, the paper adopts a qualitative methodological approach through an inductive case study of expatriates from 13 Spanish subsidiaries co-located in China. …