scholarly journals Institutions, Foreign Direct Investment, and Domestic Investment: Crowding Out or Crowding In?

2016 ◽  
Vol 88 ◽  
pp. 1-9 ◽  
Author(s):  
Kristine Farla ◽  
Denis de Crombrugghe ◽  
Bart Verspagen
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Crowding Out ◽  
Domestic Investment

Influence of foreign direct investment on domestic investment in the Russian economy

2020 ◽  
pp. 69-85
Author(s):  
I. M. Drapkin ◽  
S. A. Lukyanov ◽  
A. A. Bokova
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Crowding Out ◽  
Domestic Investment ◽  
Empirical Estimation ◽  
Negative Effects ◽  
Firm Level ◽  
Foreign Companies ◽  
Russian Economy ◽  
The Government

The paper is devoted to the empirical estimation of the effects of foreign direct investment (FDI) on domestic investment in the Russian economy. The results suggest that there are crowding-out effects of FDI on the Russian economy. Using the firm-level database for 2008—2017, we analyze the presence of foreign companies in the Russian economy on the region, industry and industry in region levels. On the regional level the statistically significant effects of crowding out domestic investment are identified for state-owned, large as well as less effective companies. On the industry level the negative effects of crowding out are observed in case when FDI share in the industry exceeds 25. Estimating the effect of FDI presence on the industry in the region level, we reveal crowding out effects mainly for private and more effective national companies. Analyzing the effects in case of different levels of FDI in the economy, we do not find support for the hypothesis of adaptation of national companies for foreign companies’ presence in the economy. The paper suggests that the government policy in FDI regulation should focus on mitigation of the effects of pushing national companies off the market, and also creating conditions for cooperation of foreign and domestic companies.

scholarly journals The interaction between Foreign Direct Investment and Domestic Investment: Is there crowding out effect?

2020 ◽  
Vol 7 (2) ◽  
pp. 163-174
Author(s):  
Tugba Akin ◽  
Ozge Bolaman Avcı
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Slovak Republic ◽  
Free Market ◽  
Panel Data Analysis ◽  
European Countries ◽  
Crowding Out ◽  
Eastern European ◽  
Domestic Investment ◽  
Eastern European Countries

After the fall of communism, Central and Eastern European countries have experienced a transition process in which a remarkable increase is observed in foreign direct investment flows into the region. During this process, when transition countries tried to adopt a free-market economy instead of a closed centrally structured economy, funds obtained through FDI constituted an essential way of financing for these countries that were trying to restructure their economy. Study questions the existence of the crowding-out effect by using data from Eastern European Countries, including Romania, the Russian Federation, Moldova, Poland, Bulgaria, Hungary, Slovak Republic, Ukraine. With this aim, PANIC Bai and Ng (2004), the bias-corrected PANIC Westerlund and Larsson (2009) unit root tests, and panel data analysis are implemented. Results obtained were consistent with theoretical expectations and showed that FDI had a crowding-out effect in the short run but, in the long run, a crowding-in impact on domestic investment.

scholarly journals Foreign Direct Investment - Domestic Investment Nexus: Evidence from India

2021 ◽  
Vol 15 (3) ◽  
pp. 267-275
Author(s):  
Abraham Babu
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Policy Implications ◽  
Data Series ◽  
Domestic Investment ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Time Period ◽  
Reform Period

The relationship between foreign direct investment and domestic investment is intriguing. An important question arises - does foreign direct investment crowd in or crowd out domestic investment? This paper examines this nexus in the post-1991 period in India, which is also considered as the post-reform period. It is during this era; the above-mentioned topic gains more impetus as the economy opened up for further foreign inflows. The time period taken for the paper was from 1990-91 to 2014-15. The data series were checked for stationarity and the presence of long run relationship between foreign direct investment and domestic investment was analysed using cointegration test. Thereafter, the vector error correction model was estimated. The results clearly show that foreign direct investment crowds out domestic investment in India in the post reform period. The findings have significant policy implications because there is a substituting relationship between foreign direct investment and domestic investment in India.

Film Production And Economic Performance: Should South Africa Invest In Movies?

2021 ◽  
Vol 4 (2) ◽  
pp. 125-144
Author(s):  
Andrew Phiri ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Economic Performance ◽  
Government Spending ◽  
Capita Income ◽  
Direct Investment ◽  
Film Production ◽  
Domestic Investment ◽  
Per Capita Income ◽  
Long Run ◽  
Per Capita

The movie industry is increasingly recognised as a possible avenue for improving economic performance. This study focuses on film production and its influence on South African economic growth (per capita income and employment between 1970 and 2020). Our autoregressive lag distributive (ARDL) estimates on a loglinearised endogenous growth model augmented with creative capital indicate that the production of movies has no significant effects on long-run GDP growth, per capita GDP and employment. The baseline regressions find a short-run positive and significant influence of film production on per capita income and are devoid of long-run effects. However, re-estimating the regressions with interactive terms between movie production and i) government spending ii) foreign direct investment, improve the significance of film regression coefficients which all turn positive and significant, for government spending, and negative for foreign direct investment. Our results indicate that foreign investment crowds out domestic investment whilst government investment in movies is growth-enhancing.

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