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Much Ado About Nothing? Do Domestic Firms Really Benefit from Foreign Investment?
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In this paper, a comprehensive evaluation of the empirical evidence on productivity, wages and exports spillovers in developing, developed and transitional economies is presented. But, although theory can identify a range of possible spillover channels, robust empirical support for positive spillovers is hard to find.Abstract:
Many governments offer significant inducements to attract inward investment, motivated by the expectation of spillover benefits. This paper begins by reviewing possible sources of spillovers. It then provides a comprehensive evaluation of the empirical evidence on productivity, wages and exports spillovers in developing, developed and transitional economies. Although theory can identify a range of possible spillover channels, robust empirical support for positive spillovers is hard to find. The reasons for this are explored and the paper concludes with a review of policy aspects.read more
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Journal ArticleDOI
Foreign Direct Investment, Competition and Industry Performance
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TL;DR: In this paper, the authors investigated the productivity effects of inward and outward foreign direct investment using industry and country level data for 17 OECD countries over the period 1973 to 2001 and found that there are, on average, productivity benefits from inward FDI, although a number of countries which, on aggregate, do not appear to benefit in terms of productivity.
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In Search of Environmental Spillovers
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Foreign Direct Investment and Growth
Laura Alfaro,Matthew S. Johnson +1 more
TL;DR: The authors examines the evolution of the literature on the relationship between foreign direct investment (FDI) and growth in host countries, particularly developing countries, and provides a broad overview, with a focus on two elements that have recently become particularly important: (1) the role of complementary local conditions conducive to reaping the benefits of FDI and (2) the mechanisms by which FDI creates positive externalities (which relate to how FDI generates growth).
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The environmental impact of industrialization and foreign direct investment
TL;DR: In this paper, the authors examined the environmental impact of foreign direct investment and industrialization in 36 selected African countries using data for the period 1980-2014 and found that the effect of industrialization on the environment is generally insignificant.
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Foreign direct investment, export and economic growth: empirical evidence from new eu countries
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TL;DR: In this paper, the authors provide a survey of the literature on FDI, export and growth, and empirically investigate the causal relationship between economic growth, export, and FDI for the ten transition European countries (Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovak Republic and Slovenia).
References
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A sensitivity analysis of cross-country growth regressions
Robert A. Levine,David Renelt +1 more
TL;DR: In this article, the authors study whether the conclusions from existing studies are robust or fragile when small changes in the list of independent variables occur, and they find that although "policy"appears to be importantly related to growth, there is no strong independent relationship between growth and almost every existing policy indicator.
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A sensitivity analysis of cross-country growth regressions
Robert A. Levine,David Renelt +1 more
TL;DR: The authors examined whether the conclusions from existing studies are robust or fragile to small changes in the conditioning information set and found a positive, robust correlation between growth and the share of investment in GDP and between investment share and the ratio of international trade to GDP.
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How does foreign direct investment affect economic growth
TL;DR: In this article, the effect of FDI on economic growth in a cross-country regression framework was investigated. And they found that FDI contributes to economic growth only when a sufficient absorptive capability of the advanced technologies is available in the host economy.
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Multinational Enterprise and Economic Analysis
TL;DR: The third edition of Multinational Enterprise and Economic Analysis surveys the contributions that economic analysis has made to our understanding of why multinational enterprises exist and what consequences they have for the workings of the national and international economies.
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Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages
TL;DR: In this paper, the authors studied the impact of trade and foreign direct investment on the productivity of domestic firms in the manufacturing sector in the country of Lithuania and found that a 10 percent increase in the foreign presence in downstream sectors is associated with a 0.38 percent rise in output of each domestic firm in the supplying industry.
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