scholarly journals A foreign direct investment: Characteristics, patterns, and effects

2008 ◽  
Vol 60 (1) ◽  
pp. 61-92 ◽  
Author(s):  
Miroslav Antevski
Keyword(s):  
Foreign Direct Investment ◽  
Economic Integration ◽  
Direct Investment ◽  
Regional Economic Integration ◽  
Host Countries ◽  
Regional Economic ◽  
Technology Knowledge ◽  
Domestic Firms ◽  
Foreign Affiliates ◽  
Backward Linkages

The author researched the foreign direct investment flows, patterns and effects in conditions of regional economic integration in Europe. The foreign direct investment presence results in two effects: first, increase in competition, and second, creation of forward and backward linkages between domestic firms and foreign affiliates. The benefits of foreign direct investment for their host countries take the form of various types of externalities or spillovers (of technology, knowledge, productivity). The potential spillover benefits could be realized if domestic firms have the capacity to absorb foreign technologies and skills.

scholarly journals Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages

2004 ◽  
Vol 94 (3) ◽  
pp. 605-627 ◽  
Author(s):  
Beata Smarzynska Javorcik
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Foreign Ownership ◽  
Foreign Investments ◽  
Firm Level ◽  
Productivity Spillovers ◽  
Level Data ◽  
Firm Level Data ◽  
Foreign Affiliates ◽  
Backward Linkages

Many countries strive to attract foreign direct investment (FDI) hoping that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. In contrast with earlier literature that failed to find positive intraindustry spillovers from FDI, this study focuses on effects operating across industries. The analysis, based on firm-level data from Lithuania, produces evidence consistent with positive productivity spillovers from FDI taking place through contacts between foreign affiliates and their local suppliers in upstream sectors. The data indicate that spillovers are associated with projects with shared domestic and foreign ownership but not with fully owned foreign investments.

scholarly journals Foreign direct investment and productivity spillovers: a firm-level analysis of Bangladesh in comparison with Vietnam

2021 ◽  
Vol 10 (1) ◽  
Author(s):  
Md Arif-Ur-Rahman ◽  
Kazuo Inaba
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Spillover Effects ◽  
External Effects ◽  
Productivity Improvement ◽  
Firm Level ◽  
Domestic Firms ◽  
Fdi Spillovers ◽  
Backward Linkages ◽  
Level Analysis

AbstractForeign direct investment (FDI) is expected to generate external effects—usually termed FDI spillovers—for a host country, and these spillovers are thought to have consequences on the productivity of domestic firms. Despite this strong expectation, the empirical findings on FDI spillover are still indecisive. This study examines firm-level panel data to determine the effects of FDI spillover on firms’ productivity in Bangladesh in comparison to Vietnam. We consider both the horizontal and vertical (backward and forward) spillover effects of FDI. We find evidence that Bangladeshi firms gain productivity improvement through intra-industry or horizontal linkages, whereas Vietnamese firms gain through backward linkages. Our findings suggest that increases in foreign presence in the same industry for Bangladesh and in downstream industries for Vietnam are related with increase in output of domestic firms.

scholarly journals OUTWARD FOREIGN DIRECT INVESTMENT AND PRODUCT QUALITY OF DOMESTIC PRODUCTIONS: AN EMPIRICAL INVESTIGATION

2010 ◽  
Vol 11 (3) ◽  
pp. 396-414 ◽  
Author(s):  
Yungho Weng ◽  
Chih-Hai Yang ◽  
Fang-Chiu Tu
Keyword(s):  
Foreign Direct Investment ◽  
Product Quality ◽  
Direct Investment ◽  
Systematic Investigation ◽  
Outward Foreign Direct Investment ◽  
Outward Fdi ◽  
Domestic Firms ◽  
Foreign Affiliates ◽  
Positive Effect

While conceptual and theoretical studies have claimed that outward foreign direct investment (FDI) is an effective way to improve the quality of domestic production, there has been less systematic investigation into that claim. The statistical analysis of a survey of Taiwan's outward FDI activity shows that FDI had a positive effect on the quality of only 33.4% of investing firms. We further employ the microeconometric technique to analyze what kinds of globalization behaviors improve the quality of domestic firms’ products. The empirical results show that the strategy of expansionary FDI is more effective than defensive FDI at improving product quality because it allows domestic firms to learn advanced technologies from guest countries. Moreover, the reallocation of export between foreign affiliates and the parent company is an effective way for investing firms to focus on improving domestic product quality. Santrauka Remiantis koncepciniu ir teoriniu tyrimu rezultatais, ieinančios tiesiogines užsienio investicijos yra veiksmingas būdas vidaus produkcijos kokybei gerinti, tačiau tokiam teiginiui pagristi nebuvo atlikti sistemingi tyrimai. Taivanio ieinančiu tiesioginiu užsienio investiciju veiklos tyrimo statistines analizes duomenimis, tiesioginiu užsienio investiciju iš visu imones investiciju itaka kokybei sudaro tik 33,4 %. Toliau buvo taikoma mikroekonometrine metodika, siekiant ištirti, kokios rūšies globalizacijos elgsena pagerina vietines imoniu produkcijos kokybe. Empirinio tyrimo rezultatai parode, kad, gerinant produkcijos kokybe, pletros tiesiogines užsienio investicijos yra efektyvesnes nei apsaugines tiesiogines užsienio investicijos. Taip yra todel, kad jos leidžia šalies vidaus imonems sužinoti apie pažangias kitu šaliu technologijas. Be to, eksporto perskirstymas tarp užsienio filialu ir pagrindines imones yra veiksmingas būdas investuojančiai imonei daugiausia demesio skirti vidaus produkcijos kokybei.

scholarly journals Regional economic integration, natural resources and foreign direct investment in SADC

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Gameli Adika
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Natural Resources ◽  
Economic Integration ◽  
Natural Resource ◽  
Direct Investment ◽  
Least Square ◽  
Regional Economic Integration ◽  
Content Type

PurposeThis paper aims to examine the role of economic integration and natural resources and foreign direct investment (FDI) complementarity in explaining economic growth in the Southern African Development Community (SADC).Design/methodology/approachThe study employed the ordinary least square-random effects and the generalized two-stage least square instrumental variables (IV) regression to examine the relationship between the variables.FindingsThe authors find that regional economic integration and natural resource abundance are essential for promoting economic growth. The results further show a potential resource curse phenomenon, offset by the complementary effect of FDI in resource-rich countries. The findings are robust after conditioning for different measures of institutional quality.Practical implicationsThe findings suggest the need for deeper regional trade integration and international cooperation, prudent natural resource management and concerted effort toward economic diversification.Originality/valueMany studies have examined the determinants of economic growth in the Southern African Development Community (SADC). However, these studies did not incorporate or assess the potential of economic integration in the region. Moreover, studies that examined the growth effects of FDI did not assess the complementary role of the region's natural resource endowment which potentially drives FDI inflows. This study fills these gaps and provides a robust analysis of economic growth drivers in the region.

China's Expanding Outward Foreign Direct Investment in Southeast Asia and its Impacts

2013 ◽  
Vol 05 (04) ◽  
pp. 87-98
Author(s):  
Hong ZHAO
Keyword(s):  
Foreign Direct Investment ◽  
Southeast Asia ◽  
Economic Integration ◽  
Direct Investment ◽  
Outward Foreign Direct Investment ◽  
Host Countries ◽  
Chinese Investment ◽  
Labour Division ◽  
The Impact

The surge in China's outward foreign direct investment (OFDI) has attracted considerable attention, largely projected as “neo-colonialism” in Africa and having potential effects on the host countries. In Southeast Asia, however, Chinese investment provides capital, employment, income and regional labour-division. This article analyses the nature and distribution of these investments, the main drivers of China's OFDI to Southeast Asia and the impact on economic integration in this region.

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