Property Rights Regimes, Technological Innovation, and Foreign Direct Investment

2018 ◽  
Vol 7 (3) ◽  
pp. 451-469
Author(s):  
Mark David Nieman ◽  
Cameron G. Thies
Keyword(s):  
Foreign Direct Investment ◽  
Property Rights ◽  
Direct Investment ◽  
Developed Countries ◽  
Random Coefficients ◽  
Marginal Effect ◽  
Democratic Institutions ◽  
Modeling Strategy ◽  
Over Time ◽  
Developing And Developed Countries

We argue that democratic institutions influence property rights in attracting foreign direct investment (FDI) by providing: (1) a coherent logic to the property rights regime that is created in a state and (2) a legitimate way to manage conflicts that arise in dynamic economies. We expect that the marginal effect of property rights in attracting FDI has increased over time with the rate of technological dynamism. We test this using a non-nested multilevel modeling strategy with random coefficients on data from 1970 to 2009. Our results demonstrate that the effect of property rights on attracting FDI is contingent on democratic institutions and that this effect becomes more pronounced over time. This effect holds for both developing and developed countries across all regions.

Foreign Direct Investment, Intellectual Property Rights, and Productivity Growth

2014 ◽  
Vol 05 (03) ◽  
pp. 1440009
Author(s):  
Sasatra Sudsawasd ◽  
Santi Chaisrisawatsuk
Keyword(s):  
Foreign Direct Investment ◽  
Intellectual Property ◽  
Property Rights ◽  
Intellectual Property Rights ◽  
Productivity Growth ◽  
Direct Investment ◽  
Developed Countries ◽  
Outward Fdi ◽  
The Impact ◽  
Ipr Protection

Using panel data for 57 countries over the period of 1995–2012, this paper investigates the impact of intellectual property rights (IPR) processes on productivity growth. The IPR processes are decomposed into three stages — innovation process, commercialization process, and protection process. The paper finds that better IPR protection is directly associated with productivity improvements only in developed economies. In addition, the contribution of IPR processes on growth through foreign direct investment (FDI) appears to be quite limited. Only inward FDI in developed countries which creates better innovative capability leads to higher growth. In connection with outward FDI, only the increase in IPR protection and commercialization are proven to improve productivity in the case of developing countries, particularly when the country acts as the investing country.

scholarly journals THE DETERMINANTS OF INCOME INEQUALITY: THE ROLE OF EDUCATION

2019 ◽  
Vol 66 (4) ◽  
pp. 451-464
Author(s):  
Anna Hovhannisyan ◽  
Ramon Castillo-Ponce ◽  
Rolando Valdez
Keyword(s):  
Foreign Direct Investment ◽  
Income Inequality ◽  
Direct Investment ◽  
Elderly Population ◽  
Trade Openness ◽  
Developed Countries ◽  
Shed Light ◽  
Country Specific ◽  
Developing And Developed Countries

The economics literature reports mixed evidence on the importance of education as a determinant of income inequality. In this document we shed light on the debate by testing this relationship for a sample of developing and developed countries from 1990 to 2014. We control for country specific characteristics including trade openness, unemployment, foreign direct investment, and the share of elderly population. The results of robust panel data estimations unequivocally find that education is negatively and significantly associated with income inequality.

The Determinants of Foreign Direct Investment in Pakistan

2004 ◽  
Vol 43 (4II) ◽  
pp. 651-664 ◽  
Author(s):  
Anjum Aqeel ◽  
Mohammed Nishat
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Development Process ◽  
Developed Countries ◽  
The Other ◽  
Mutual Benefit ◽  
Marginal Productivity ◽  
Developed World ◽  
Developing And Developed Countries

The significance of foreign direct investment (FDI) flows is well documented in literature for both the developing and developed countries. Over the last decade foreign direct investment have grown at least twice as rapidly as trade Meyer, (2003). As there is shortage of capital in the developing countries, which need capital for their development process, the marginal productivity of capital is higher in these countries. On the other hand investors in the developed world seek high returns for their capital. Hence there is a mutual benefit in the international movement of capital.

Reversal of Fortunes: Democratic Institutions and Foreign Direct Investment Inflows to Developing Countries

2003 ◽  
Vol 57 (1) ◽  
pp. 175-211 ◽  
Author(s):  
Quan Li ◽  
Adam Resnick
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Property Rights ◽  
Direct Investment ◽  
Multinational Enterprises ◽  
Democratic Institutions ◽  
Foreign Investors ◽  
Fdi Inflows ◽  
Rights Protection ◽  
Property Rights Protection

Does increased democracy promote or jeopardize foreign direct investment (FDI) inflows to less-developed countries? We argue that democratic institutions have conflicting effects on FDI inflows. On the one hand, democratic institutions hinder FDI inflows by limiting the oligopolistic or monopolistic behaviors of multinational enterprises, facilitating indigenous businesses' pursuit of protection from foreign capital, and constraining host governments' ability to offer generous financial and fiscal incentives to foreign investors. On the other hand, democratic institutions promote FDI inflows because they tend to ensure more credible property rights protection, reducing risks and transaction costs for foreign investors. Hence, the net effect of democracy on FDI inflows is contingent on the relative strength of these two competing forces. Our argument reconciles conflicting theoretical expectations in the existing literature. Empirical analyses of fifty-three developing countries from 1982 to 1995 substantiate our claims. We find that both property rights protection and democracy-related property rights protection encourage FDI inflows; after controlling for their positive effect through property rights protection, democratic institutions reduce FDI inflows. These results are robust against alternative model specifications, statistical estimators, and variable measurements.

scholarly journals Is Russia successful in attracting foreign direct investment? Evidence based on gravity model estimation

2016 ◽  
Vol 16 (3) ◽  
pp. 245-267 ◽  
Author(s):  
Oleg Mariev ◽  
Igor Drapkin ◽  
Kristina Chukavina
Keyword(s):  
Foreign Direct Investment ◽  
Gravity Model ◽  
Host Country ◽  
Direct Investment ◽  
Recipient Country ◽  
Developed Countries ◽  
Likelihood Method ◽  
Empirical Estimation ◽  
Fdi Inflows ◽  
Russian Economy

Abstract The aim of this paper is twofold. First, it is to answer the question of whether Russia is successful in attracting foreign direct investment (FDI). Second, it is to identify partner countries that “overinvest” and “underinvest” in the Russian economy. We do this by calculating potential FDI inflows to Russia and comparing them with actual values. This research is associated with the empirical estimation of factors explaining FDI flows between countries. The methodological foundation used for the research is the gravity model of foreign direct investment. In discussing the pros and cons of different econometric methods of the estimation gravity equation, we conclude that the Poisson pseudo maximum likelihood method with instrumental variables (IV PPML) is one of the best options in our case. Using a database covering about 70% of FDI flows for the period of 2001-2011, we discover the following factors that explain the variance of bilateral FDI flows in the world economy: GDP value of investing country, GDP value of recipient country, distance between countries, remoteness of investor country, remoteness of recipient country, level of institutions development in host country, wage level in host country, membership of two countries in a regional economic union, common official language, common border and colonial relationships between countries in the past. The potential values of FDI inflows are calculated using coefficients of regressors from the econometric model. We discover that the Russian economy performs very well in attracting FDI: the actual FDI inflows exceed potential values by 1.72 times. Large developed countries (France, Germany, UK, Italy) overinvest in the Russian economy, while smaller and less developed countries (Czech Republic, Belarus, Denmark, Ukraine) underinvest in Russia. Countries of Southeast Asia (China, South Korea, Japan) also underinvest in the Russian economy.

The Rise of Transnational Corporations from Developing Countries in the Second Half of the 20th Century

Istoriya ◽  
2021 ◽  
Vol 12 (11 (109)) ◽  
pp. 0
Author(s):  
Alexey Kuznetsov
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Global Economy ◽  
World Order ◽  
Developed Countries ◽  
Global South ◽  
Business Environment ◽  
Outward Foreign Direct Investment ◽  
Foreign Direct Investment Stock

The article highlights three stages of the formation of multinationals from developing countries. Although first Argentine TNCs appeared at the turn of the 19th — 20th centuries, in the majority of the Global South countries TNCs appeared in the 1960s — 1980s. With the collapse of the bipolar world order, which in many developing countries was accompanied by significant internal political and economic transformations, the second stage of foreign expansion of TNCs from the Global South began. Indeed, in 1990 they accounted for 6 % of global outward foreign direct investment stock, while the figure was 10 % by the end of 2005. We date the beginning of the third stage to the financial and economic crisis of 2007—2009, since multinationals from developing countries as a whole are more successfully overcoming the period of turbulence in the global economy. By the end of 2020, they accounted for 22 % of global outward foreign direct investment stock, and during the COVID-19 pandemic crisis they generally exported more than 50% of the capital. The modern foreign expansion of such TNCs has many reasons, differs greatly from country to country, and often differs slightly from the specifics of Western multinationals. At the same time, initially, “late internationalization” in developing countries had two main vectors — the use of new opportunities for South — South cooperation and overcoming, through the creation of subsidiaries in highly developed countries, the shortcomings of the business environment of “catching up” countries.

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