This article analyzes the location determinants of foreign direct investment in services, both theoretically and empirically. It hypothesizes four sets of factors as the location determinants of FDI in services based on the standard theory of FDI. The generalized investment theory on China’s foreign direct investment is tested empirically utilizing panel data for 17 provinces and cities from 20...

Foreign direct investment (FDI) is a vital mechanism in modern economic development. In many transition countries of Central and Eastern Europe FDI is particularly seen as the main source of catching-up with more developed countries of European Union. This paper contributes to the methodology of evaluating the impact of FDI on the host country by taking into account the impact of FDI both on te...

This paper examines the effect of foreign direct investment (FDI) on growth by focusing on the complementarities between FDI inflows and financial markets. In our earlier work, we find that FDI is beneficial for growth only if the host country has well-developed financial institutions. In this paper, we investigate whether this effect operates through factor accumulation and/or improvements in ...

Following the notion of skill-biased FDI fl ows from developed to less developed regions, high-skilled workers are likely to benefi t from FDI to a larger extent. They earn a productivity advantage that potentially transfers into a skilled wage premium. This gives rise to distributional confl ict that might turn into heterogeneous attitudes toward FDI infl ows in line with skill. In this paper ...

Foreign direct investment (FDI) refers to long term participation by country A into country B. There are two types of FDI: inward FDI and outward FDI. Many African countries have already done much to create a more business-friendly environment and many have made impressive progress towards political and economic stability. In their efforts to revive economic activity they have scaled down burea...

The paper described the movements of agricultural growth and FDI to agriculture, and determined the causality between the two variables. Agricultural growth was represented by real agricultural GDP growth rate and FDI represented by a ratio of inward FDIs to agriculture as a ratio of agriculture value added. Between 1966 and 2008, growth showed significant movements across the zero line. Over t...

Using firm-level census data, this paper examines the spillover effects of foreign direct investment (FDI) on domestic firms in the Chinese manufacturing industry between 2000 and 2003. We find that FDI has a significant positive spillover on industry productivity that decreases as the share of FDI in the industry increases. These positive spillovers are more likely to occur through forward lin...

It is widely feared that outward FDI gradually hollows out domestic manufacturing and displaces local workers. We address this concern by drawing on exceptionally informative firm-specific data on Taiwanese multinationals in manufacturing. In particular, we assess whether repercussions at home depend on the size, location and type of outward FDI. We control for firm heterogeneity and estimate o...

Global patterns of FDI and trade are remarkably similar, yet mainstay theory has them as substitutes. We posit a model where multiproduct, final-goods firms simultaneously engage in intraindustry FDI and intraindustry trade. The logic behind this two-way FDI is analogous to that of two-way trade in the Brander–Krugman reciprocal-dumping model. Namely, multiproduct firms use trade costs to reduc...

Foreign direct investment (FDI) has grown far more rapidly than trade during the last two decades. As with the other prominent features of globalisation, FDI is controversial. The impact of FDI on labour markets has been of growing concern, particularly, for source countries. The deterioration of labour market conditions for unskilled workers in many OECD countries during the 1980’s and 1990’s ...