Korea’s Foreign Direct Investment in the Automotive Industry in China

China Report ◽  
2018 ◽  
Vol 54 (2) ◽  
pp. 175-193 ◽  
Author(s):  
Jungmin Lee ◽  
Jai S. Mah
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Technology Transfer ◽  
Automotive Industry ◽  
Direct Investment ◽  
Policy Implications ◽  
Foreign Firms ◽  
Job Opportunities ◽  
Korean Firm ◽  
The Impact

This article examines the impact of foreign-invested enterprises in the development of China’s automotive industry. It particularly focuses on the case of foreign direct investment (FDI) by a Korean firm, namely, the Hyundai Motor Company, in China. The Chinese government’s policy regarding the automotive industry allowed China’s domestic manufacturers to benefit from technology transfer, as foreign firms were not allowed to invest exclusively in China without a partnership. The contribution of Korea’s investment in China’s automotive industry would comprise the creation of job opportunities, technology transfer and the development of the automobile parts industry. Korea’s investment in the automotive industry of China has policy implications for China and other developing countries trying to expand their technology-intensive industries.

Globalization and Willingness to Support the Poor in Developing Countries: An Experiment in India

2020 ◽  
Vol 53 (10-11) ◽  
pp. 1656-1689
Author(s):  
Sera Linardi ◽  
Nita Rudra
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Text Analysis ◽  
Financial Support ◽  
Direct Investment ◽  
Foreign Firm ◽  
Foreign Firms ◽  
The Poor ◽  
Job Opportunities

Does an individual’s exposure to aspects of globalization impact their willingness to redistribute to the poor? We hypothesize that the “glitter” of foreign direct investment (FDI) in developing countries leads relatively better-off citizens to perceive that the poor now have more opportunities and are thereby less deserving of help. Findings from an experiment across three states in India reveal that subjects lower their financial support for the poor upon learning a foreign firm in a low-skilled sector is located in the vicinity. Text analysis of subjects’ responses supports the mechanism underlying our hypothesis: FDI reduces support for redistribution when subjects believe that foreign firms offer the uneducated poor higher wages and increased job opportunities.

scholarly journals Determinants of Foreign Direct Investment in Developed and Developing Countries: Impact of Political Stability

2021 ◽  
Vol 17 (4) ◽  
pp. 1390-1404
Author(s):  
R.I. Vasilyeva ◽  
◽  
O.S. Mariev ◽  
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Developing Economies ◽  
Political Stability ◽  
Policy Implications ◽  
Likelihood Method ◽  
Developed Economies ◽  
Development Level ◽  
The Impact

Stable political environment and prominent development of political institutions increase foreign direct investment flows by providing lower risks for investors. However, this impact can vary according to the development of the country. This study aims to investigate the impact of various indicators of political stability on foreign direct investment attraction for different economies distinguished by their development level. Our database includes 66 FDI-recipient countries and 98 FDI-investing countries for the period from 2001 to 2018. By applying the gravity approach and Poisson Pseudo Maximum Likelihood method with instrumental variables (IV PPML), we model bilateral FDI flows, incorporating variables reflecting various aspects of political stability formed by the principal components analysis. Interestingly, we found mixed results regarding the impact of political stability on FDI flows. In particular, political stability indicators were found to be insignificant, when analysing the bilateral FDI flows for the group of developed economies. We obtained similar result for the group of developing economies. However, political stability variables significantly influence FDI flows for countries with different development level, confirming the hypothesis that countries’ development affects bilateral FDI flows. Besides, we discover the significant difference between developed and developing countries referring to FDI-investors. Based on the obtained results, we highlight a few policy implications for developing and developed economies.

Foreign Direct Investment Flows from China to Korea in the Automobile Industry

China Report ◽  
2017 ◽  
Vol 53 (1) ◽  
pp. 26-45 ◽  
Author(s):  
Ka-Hyun Lee ◽  
Jai S. Mah
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Technology Transfer ◽  
Automobile Industry ◽  
Direct Investment ◽  
Policy Implications ◽  
Positive Effects ◽  
Transfer Of Technology ◽  
Overseas Investment ◽  
Catch Up

This article addresses the effect of foreign direct investment (FDI) flows from China to Korea, particularly in the case of the automobile industry. Despite the various positive effects that FDI brings to the growth of the automobile industry, concerns and doubts have been cast upon China’s overseas investment in Korea’s automobile industry, as FDI may involve the transfer of technology, and thereby, China may soon catch up with Korea technologically. The Shanghai Automotive Industrial Corporation’s (SAIC) acquisition of one of the automobile producers of Korea, Ssangyong Motor Corporation, and the consequent technology transfer or leakage have become a controversial national issue in Korea. This article draws the policy implications from the case of the former corporation’s acquisition of the latter in light of the economic development and industrialisation of developing countries in general.

scholarly journals The Impact of Foreign Direct Investment on the Romanian Labour Market: New Evidence from a Pooled Model

2017 ◽  
Vol 10 (1) ◽  
pp. 19-34
Author(s):  
Laura Diaconu Maxim ◽  
Daniel Sterbuleac
Keyword(s):  
Foreign Direct Investment ◽  
Labour Market ◽  
Direct Investment ◽  
Added Value ◽  
Foreign Firms ◽  
Net Income ◽  
Foreign Companies ◽  
Study Results ◽  
One Year ◽  
The Impact

Abstract The present paper presents a series of results concerning the labour market impact of the foreign direct investment (FDI) inflows in Romania, during the period 2005-2014. In order to reach this objective, we have conducted both an investigation of the specialized literature and an econometric analysis, based on a pooled OLS regression. The added value of this study results from the novelty aspects brought by the results, which indicate two new roles of FDI on the Romanian labour market: a potential “gap-widening” effect between the civil employment and number of employees and a “crawling” effect on the net income. Since the results showed a positive correlation between FDI and civil employment and also between FDI and the average number of employees, the first effect suggests that most of employees of the foreign firms work there less than one year. This may explain why foreign companies are not motivated to offer their employees much higher wages than the local firms and thus that the effect of FDI on nominal net income is very small (“crawling” effect).

scholarly journals The Impact of Foreign Direct Investment on the Productivity of China’s Automotive Industry

2010 ◽  
pp. 284-304 ◽  
Author(s):  
Peter J. Buckley ◽  
Jeremy Clegg ◽  
Ping Zheng ◽  
Pamela A. Siler ◽  
Gianluigi Giorgioni
Keyword(s):  
Foreign Direct Investment ◽  
Automotive Industry ◽  
Direct Investment ◽  
The Impact

The Impact of Foreign Direct Investment on Sectoral Adjustment in the Irish Economy

1997 ◽  
Vol 160 ◽  
pp. 76-86 ◽  
Author(s):  
Frances Ruane ◽  
Holger Görg
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Manufacturing Sector ◽  
Foreign Firms ◽  
Export Markets ◽  
Manufacturing Plants ◽  
Foreign Companies ◽  
Fiscal Incentives ◽  
The Republic ◽  
The Impact

Foreign direct investment (FDI) has played a crucial role in the overall development of the Irish economy over the past three decades, as the Republic of Ireland, hereafter referred to as Ireland, has pursued an industrial strategy characterised by (i) promoting export-led-growth in Irish manufacturing through various financial supports and fiscal incentives, and (ii) encouraging foreign companies to establish manufacturing plants in Ireland, producing specifically for export markets. The significance of FDI for the Irish economy is now reflected in, inter alia, the significant gap between GNP and GDP; in 1994, GNP was roughly 88 per cent of GDP in Ireland. As regards the manufacturing sector, the high shares of output and employment in foreign-owned companies in Ireland also indicate the importance of foreign firms. As we discuss in some detail in Section 3, foreign companies produced roughly 69 per cent of total net output and accounted for 45 per cent of employment in Irish manufacturing industries in 1993.

scholarly journals Protection of National Sovereignty and Hindering Foreign Investment

2017 ◽  
pp. 1-14
Author(s):  
Badreddine Berrahlia ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Technology Transfer ◽  
Foreign Investment ◽  
Direct Investment ◽  
Foreign Direct Investments ◽  
Business Law ◽  
National Sovereignty ◽  
Investment Projects ◽  
Recent Debate ◽  
The Impact

The article explores the recent debate regarding the rules of sovereignty and the need to acquire technology through Foreign Direct Investment (FDI) in relation to the Algerian Business Law. The article explores the 51/49 rule as an obligatory condition for direct international partnerhip projects, which requires a majority of Algerian ownership of at least 51 percent in all foreign direct investment projects (FDIP). The current research also investigates the impact of the 51/49 rule on the inflows of the foreign direct investments in Algeria as well as some other countries. The research concludes that there is no evidence that the amendment of the 51/49 rule would lead to technology transfer through the FDI.

scholarly journals Impact of Foreign Direct Investment on Domestic Investment in Developing Countries

2020 ◽  
Vol 6 (9) ◽  
pp. 256-266
Author(s):  
A. Mamatkulov
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Developing Economies ◽  
Negative Impact ◽  
Domestic Investment ◽  
Short Term ◽  
Total Investment ◽  
The Impact

Author analyzes the impact of foreign direct investment on domestic investment in host developing countries and checks whether a foreign direct investment has a “positive” or “negative” impact on domestic investment, as well as evaluating the impact of selected variables on this relationship. Using a full sample, the main conclusion of this study is that FDI does have a positive (crowding out) effect on domestic investment in this sample of developing economies. In the short term, an increase in FDI by one percentage point as a percentage of GDP leads to an increase in total investment as a percentage of the host country’s GDP of about 10.7%, while in the long term this effect is about 31% dollar terms, one US dollar represents us 1.7$ of total investment in the short term and us 3.1$ in the long term. Based on the results of this study, it was once again proved that inflation hinders domestic investment in host countries by 0.04% and 0.12% in the short and long term, respectively.

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