Tax Effects on Investment Location: Evidence from Foreign Direct Investment in the U.S. States

2003 ◽  
Author(s):  
Claudio A. Agostini ◽  
Soraphol Tulayasethien
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Tax Effects ◽  
Investment Location ◽  
The U.S

scholarly journals International Trade and Foreign Direct Investment as Innovation Factors of the U.S. Economy

2014 ◽  
Vol 41 (1) ◽  
pp. 60-75
Author(s):  
Tomasz M. Napiórkowski
Keyword(s):  
Foreign Direct Investment ◽  
International Trade ◽  
Direct Investment ◽  
Positive Impact ◽  
The United States ◽  
Annual Data ◽  
Main Portion ◽  
The Impact ◽  
Total Impact ◽  
The U.S

Abstract The aim of this research is to asses the hypothesis that foreign direct investment (FDI) and international trade have had a positive impact on innovation in one of the most significant economies in the world, the United States (U.S.). To do so, the author used annual data from 1995 to 2010 to build a set of econometric models. In each model, 11 in total) the number of patent applications by U.S. residents is regressed on inward FDI stock, exports and imports of the economy as a collective, and in each of the 10 SITC groups separately. Although the topic of FDI is widely covered in the literature, there are still disagreements when it comes to the impact of foreign direct investment on the host economy [McGrattan, 2011]. To partially address this gap, this research approaches the host economy not only as an aggregate, but also as a sum of its components (i.e., SITC groups), which to the knowledge of this author has not yet been done on the innovation-FDI-trade plane, especially for the U.S. Unfortunately, the study suffers from the lack of available data. For example, the number of patents and other used variables is reported in the aggregate and not for each SITC groups (e.g., trade). As a result, our conclusions regarding exports and imports in a specific SITC category (and the total) impact innovation in the U.S. is reported in the aggregate. General notions found in the literature are first shown and discussed. Second, the dynamics of innovation, trade and inward FDI stock in the U.S. are presented. Third, the main portion of the work, i.e. the econometric study, takes place, leading to several policy applications and conclusions.

scholarly journals Motives for foreign direct investment location in Europe and EU enlargement

2020 ◽  
Vol 52 (8) ◽  
pp. 1681-1699
Author(s):  
Jonathan Jones ◽  
Ilona Serwicka ◽  
Colin Wren
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Eu Enlargement ◽  
Conditional Logit Model ◽  
Conditional Logit ◽  
National Market ◽  
Eclectic Paradigm ◽  
Accession Process ◽  
Investment Location ◽  
The Eu

European Union (EU) enlargement of the mid-2000s is likely to have changed the motives for foreign direct investment (FDI) location between the existing Member States (the EU15) and the new entrants of Central and Eastern Europe (CEECs), but it is poorly understood. This paper uses the framework of Dunning’s eclectic paradigm and data for 35,105 foreign investments in Europe not only to examine if the motives differ between these, but also how they are affected by the enlargement. Three asset-exploiting motives of market, resource and efficiency seeking are explored using a conditional logit model for the location choice. This is separately for greenfield and brownfield FDI, involving new facilities or jobs, where the latter is efficiency seeking from an expansion or a co-location of functions. The paper finds greenfield FDI in the CEECs seeks an export platform for the EU market and a low-skilled workforce but a national market and higher skills in the EU15. Brownfield FDI differs from this for expansions only, for which the EU market is important, reflecting scale economies. Surprisingly, EU enlargement has a much stronger effect on the FDI location motives in the EU15 by increasing the importance of the European market, which is possibly because the CEEC liberalisation was ongoing throughout the accession process. The paper finds evidence that the differences in the motives between the CEECs and EU15 are narrowing over time, but they are pronounced, and it is argued that they will persist.

Tiptoeing the Line Between National Security and Protectionism: A Comparative Approach to Foreign Direct Investment Screening in the United States and European Union

2019 ◽  
Vol 47 (02) ◽  
pp. 105-117
Author(s):  
Jason Jacobs
Keyword(s):  
United States ◽  
European Union ◽  
Foreign Direct Investment ◽  
National Security ◽  
Direct Investment ◽  
The United States ◽  
Comparative Approach ◽  
The European Union ◽  
Policy Goals ◽  
The U.S

AbstractWeaponization of state-backed, foreign investments by China is an emerging national security threat in the United States and the European Union. The U.S. and E.U. have espoused similar policy goals—to address the threat without closing their markets to foreign direct investment—while fostering increased cooperation between allied partners in screening transactions.On the surface, the recent, China-specific measures taken by the U.S. and the investment screening framework adopted by the E.U. appear reflective of an alignment of those policy goals. Indeed, many commentators have suggested that is exactly what is happening. However, closer examination reveals a stark divergence. The U.S. has a robust screening mechanism that has evolved into a weapon of economic warfare. The E.U. meanwhile, remains a patchwork of conflicting—or nonexistent—national regulations overlaid by a comparatively toothless investment screening framework.There is a tendency to attribute this divergence to structural differences between the United States and European Union. This in-depth comparison of U.S. and E.U. investment screening mechanisms exposes a split that goes beyond application and into actual policy. This revelation should temper expectations that the E.U. is equipping itself to block transactions that are of concern to the U.S.

scholarly journals North American Integration and Canadian Foreign Direct Investment

2010 ◽  
Vol 10 (1) ◽  
Author(s):  
Andreas Waldkirch ◽  
Ayça Tekin-Koru
Keyword(s):  
Foreign Direct Investment ◽  
Free Trade ◽  
North American ◽  
Direct Investment ◽  
Free Trade Agreement ◽  
Opposite Effect ◽  
Trade Agreement ◽  
Fixed Costs ◽  
The North ◽  
The U.S

Abstract We investigate how economic integration in North America has altered the pattern of foreign direct investment (FDI) to and from Canada. The theoretical analysis suggests that while the Canadian-U.S. free trade agreement should generate less FDI, the addition of Mexico in the North American Free Trade Agreement (NAFTA) produces the opposite effect. The fall in trade costs results in investment diversion from the U.S. and Canada, yet lower fixed costs may increase FDI even in those countries via an increased incentive to locate production facilities abroad rather than only domestically. Using a difference-in-differences estimator, we find that U.S. FDI in Canada as well as Canadian FDI in the U.S. have expanded disproportionately since NAFTA, suggesting that the latter effect dominates.

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