scholarly journals The relationship between domestic and outward foreign direct investment: The role of industry-specific effects

2005 ◽  
Vol 14 (6) ◽  
pp. 677-694 ◽  
Author(s):  
Pontus Braunerhjelm ◽  
Lars Oxelheim ◽  
Per Thulin
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Outward Foreign Direct Investment ◽  
Specific Effects ◽  
The Relationship

On the Relationship between Informal and Formal Institutions, Foreign Direct Investment, and Innovation in Emerging Markets

2016 ◽  
pp. 176-197
Author(s):  
Natalya Smith ◽  
Ekaterina Thomas
Keyword(s):  
Foreign Direct Investment ◽  
Emerging Markets ◽  
Direct Effect ◽  
Direct Investment ◽  
Non Linear ◽  
Innovation Output ◽  
Positive Direct ◽  
The Relationship ◽  
India And China

This chapter examines innovation in socio-institutional environments of three largest and most diverse emerging markets: Russia, India and China over the period 1990-2014. It considers formal (proxied by corruption) and informal (proxied by trust) institutions and non-linear forces. It also examines the role of Foreign Direct Investment (FDI) in (the likelihood of) fostering innovation and of two research and development (R&D) inputs: R&D expenditures and personnel. A significantly positive direct effect of trust and a negative direct effect of corruption are confirmed, whilst there is a significant non-linear decreasing relationship with trust and increasing relationship with corruption. Interestingly, FDI and R&D expenditures are found to decrease innovation, whilst R&D personnel increase innovation output across the sample.

The Role of Financial Development in the Relationship Between Foreign Direct Investment and Economic Growth: A Nonlinear Approach

2019 ◽  
Vol 22 (02) ◽  
pp. 1950009 ◽  
Author(s):  
Elya Nabila Abdul Bahri ◽  
Abu Hassan Shaari Md Nor ◽  
Tamat Sarmidi ◽  
Nor Hakimah Haji Mohd Nor
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Financial Development ◽  
Absorptive Capacity ◽  
Direct Investment ◽  
Global Financial Crisis ◽  
Using Data ◽  
Relationship Of ◽  
The Relationship

Financial development is recognized as an absorptive capacity in the relationship between foreign direct investment (FDI) and economic growth. Therefore, FDI effect on economic growth is contingent with the level of financial development. However, existing studies also show that financial development dampens economic growth through the “too much finance harms economic growth” hypothesis. Hence, there is a question of how far financial development should be developed to optimize the benefits of FDI on economic growth. The novelty of this study is that it reexamines the role of financial development in FDI-growth relationship by including the interaction term between FDI and the nonlinearity of financial development on economic growth in the period following the 2007–2008 Global Financial Crisis. Interestingly, our results demonstrate that the nonlinear relationship of financial development on economic growth is a U-shaped curve by using data from the 2009–2013 period, for 65 developing countries, which contrast the findings from previous studies. The absorptive capacity effects work nonlinearly, in that FDI accelerates growth after reaching a certain level of financial development, and that the positive effect originates from a minimum level. The study thus suggests that the level of financial development needs to be increased since it serves as a form of absorptive capacity enabling the positive growth effects of FDI in the recipient countries.

Technological innovation policy and Chinese heterogeneity enterprises' outward foreign direct investment

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jinjing Zhao ◽  
Jongchul Lee
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Innovation Policy ◽  
Local Economy ◽  
Outward Foreign Direct Investment ◽  
Central State ◽  
Chinese Enterprises ◽  
Content Type ◽  
Privately Owned

PurposeThe study aims to analyze the role of the Made in China 2025 (MIC2025) initiative in China's Outward Foreign Direct Investment (OFDI) and the factors affecting the success or failure of Chinese enterprises' OFDI from the perspectives of the heterogeneity of home country enterprises.Design/methodology/approachBased on data on China's OFDI obtained from the China Global Investment Tracker (CGIT), the study uses the difference-in-differences model to analyze 2,670 completed OFDI deals and 211 failed OFDI deals by Chinese enterprises, from 2009 to 2018.FindingsThe study found that the effect of MIC2025 on Chinese enterprises' OFDI varies according to the ownership structure of the home country's enterprises. For successful OFDI, MIC2025 significantly impacted central state-owned enterprises (CSOEs), while it did not significantly influence local SOEs and privately owned enterprises. For failed OFDI, the MIC2025 plan only increased the failure of CSOEs' OFDI for the technology-seeking motivation in high-income host countries. Further, the investment options of local SOEs differ from those of CSOEs. Considering their aim to drive the local economy and seek profits, they are more similar to those of privately owned enterprises.Originality/valueThis study used a new database (i.e. the CGIT) to analyze Chinese enterprises' OFDI. It discussed the role of MIC2025 for different enterprises from the perspectives of successful and failed OFDI. It thus provided a new basis for analyzing policy affecting the OFDI of Chinese enterprises.

The Energy Consumption-Environmental Quality Nexus in BRICS Countries: The Role of Outward Foreign Direct Investment (OFDI)

2021 ◽  
Author(s):  
Saileja Mohanty ◽  
Narayan Sethi
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Energy Consumption ◽  
Environmental Quality ◽  
Direct Investment ◽  
Early Stage ◽  
Outward Foreign Direct Investment ◽  
Stage Of Development ◽  
Long Run

Abstract This paper examines the role of outward foreign direct investment (OFDI) on energy consumption and environmental quality in BRICS from 1990 to 2019. We use cross-sectional dependence (CSD) and the Pesaran-Yamagata slope homogeneity for the diagnostic test. After confirming the diagnosis test, we employ CIPS and CADF second generation panel unit root test, which confirms that all elements are stationary at first difference. The Pooled Mean Group (PMG), Westerlund cointegration, two-step GMM, panel FMOLS and DOLS model have been used to determine the short term and long-term association among the variables. The cointegration and PMG results confirm that the short-run and long-run association exists among the considered variables. The GMM and DOLS results reveal that developing countries produced environmental pollution at the early stage of development and checked in the long run. The empirical results hold up the EKC hypothesis, which implies that OFDI and energy consumption help expand greener technology to host countries' environmental improvement in the long run and confirm that an inverted U-shaped linkage exists. Hence, the study suggests that developing countries should pay more attention to sustainable development and technological development that encourages more eco-friendly and environment-friendly technology. To frame the profitable strategies, governments of emerging countries should inspire public-private partnerships to circulate the environmental consciousness, guideline for energy efficiency, and generate a pollution-free environment.

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