Domestic Effects of the Foreign Activities of US Multinationals

Do firms investing abroad simultaneously reduce their domestic activity? This paper analyzes the relationship between the domestic and foreign operations of US manufacturing firms between 1982 and 2004 by instrumenting for changes in foreign operations with GDP growth rates of the foreign countries in which they invest. Estimates produced using this instrument indicate that 10 percent greater foreign investment is associated with 2.6 percent greater domestic investment, and 10 percent greater foreign employee compensation is associated with 3.7 percent greater domestic employee compensation. These results do not support the popular notion that expansions abroad reduce a firm's domestic activity, instead suggesting the opposite. (JEL F23, H25, L25)

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INVESTMENT AND ECONOMIC GROWTH: THE EXAMPLE OF BOSNIA AND HERZEGOVINA

ACTA ECONOMICA ◽

10.7251/ace2033021b ◽

2021 ◽

pp. 21-41

Author(s):

Jelena Bjelić

Keyword(s):

Economic Growth ◽

Growth Rate ◽

Bosnia And Herzegovina ◽

Foreign Investment ◽

Added Value ◽

Gdp Growth ◽

Gdp Growth Rate ◽

Total Investment ◽

The Impact ◽

The Relationship

An investment is a factor of the economic growth and a mandatory constituent in the majority of development models. This study analyzes the impact of the gross investment on the economic growth in Bosnia and Herzegovina (BiH) for the period 2005-2017, and provides the assessment of the interdependence of investment and a newly added value in industry. The relationship between the foreign investment and the economic growth is also included. The dependent variables are the GDP growth rate and the added value in industry (as % of GDP). The independent variables are the total investment rate (as % of GDP) and the foreign investment rate (as % of GDP). The hypothesis is that the gross investment and the foreign investment are positively correlated with the GDP growth rate. The investments contribute to a higher newly added value in industry. The results show that the gross investment is a significant factor of the economic growth because there is a high significance and positive correlation between the observed variables (the total investment and the GDP growth). This shows that the investment growth stimulates the economic growth in Bosnia and Herzegovina. But the dynamic analysis as an investment-GDP ratio shows oscillations. The impact of investments on the share of the newly added value in industry is insignificant and negative. The results of the dynamic analysis are similar. The relationship between the variables of the foreign investment rates and the GDP growth is significant and positive. Although the foreign investments are not sufficient, they still contribute, to a certain extent, to the economic growth of BiH.

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Dependence on Foreign Investment and Economic Growth in the Third World

World Politics ◽

10.2307/2010262 ◽

1982 ◽

Vol 34 (2) ◽

pp. 175-196 ◽

Cited By ~ 44

Author(s):

Robert W. Jackman

Keyword(s):

Economic Growth ◽

Foreign Investment ◽

Growth Rates ◽

Third World ◽

The Third ◽

Shape Pattern ◽

Initial Wealth ◽

The Third World ◽

Rates Of Growth ◽

The Relationship

Estimates of the extent to which Third World countries have experienced slower rates of growth than those in the industrialized West since i960 indicate a weak relation between initial wealth and subsequent economic growth that follows an inverted U-shape pattern: while the lowest growth rates are found among the poorest countries of the Third World, the highest growth rates are found not in the industrialized West, but in the wealthiest Third World countries. Drawing on contending arguments associated with modernization and dependency perspectives, the relationship between foreign investment and growth within the Third World is examined. Results undermine the idea that foreign investment inhibits growth, suggesting instead that flows of foreign investment may facilitate growth, especially among the initially wealthier countries of the Third World.

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ANALISIS FAKTOR - FAKTOR YANG MEMPENGARUHI PERTUMBUHAN PRODUK DOMESTIK REGIONAL BRUTO ERA DESENTRALISASI FISKAL DI PROPINSI BANTEN PERIODE 2001:1-2009:4

Media Ekonomi ◽

10.25105/me.v18i2.2250 ◽

2017 ◽

Vol 18 (2) ◽

pp. 29 ◽

Cited By ~ 1

Author(s):

Hendry Sulaiman Nasution

Keyword(s):

Foreign Investment ◽

Government Spending ◽

Goodness Of Fit ◽

Linear Regression Analysis ◽

Multiple Linear Regression Analysis ◽

Domestic Investment ◽

Independent Variables ◽

A Value ◽

Original Region ◽

The Relationship

The purpose of this study was to determine the factors that affect economic growth in the Province of Banten. This research was using the multiple linear regression analysis which is used to measured the pattern of the relationships between dependent variable and independent variables. The variable GRDP is a dependent variable and the independent variable are Income Original Region, General Allocation Fund, Fund Devide Result, Inflation, Foreign Investment, Domestic Investment, Government Spending and Labor. The estimation result of this model, showed that from 8 variables, there were 3 variables that insignificant which were inflation, foreign investment and domestic investment to influenced GRDP Province of Banten. Another five variables which were : Income Original Region, General Alocation fund, Fund Devide Result, Government spending and labour that significant to influenced GRDP. In the other hand, Goodness of fit of this model had a value of R² were 0,9867. From this model about 98,67% the Independent variables Income Original Region, General Allocation Fund, Fund Devide Result , Inflation, Foreign Investment , Domestic Investment, Government Spending and Labor expalained the relationship to GRDP of Banten. And about 1,32% will be explained by another variables that not obtained in this model.

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Pengaruh GDP, Ekspor dan Investasi Terhadap Inflasi di Lima Negara Anggota IDB

Jurnal Ekonomi ◽

10.24912/je.v25i1.628 ◽

2020 ◽

Vol 25 (1) ◽

pp. 81

Author(s):

Novita, Sri Herianingrum

Keyword(s):

Quantitative Analysis ◽

Panel Data ◽

Foreign Investment ◽

Government Policies ◽

Domestic Investment ◽

Independent Variables ◽

Positive Meaning ◽

The Government ◽

The Relationship ◽

Domestic Inflation

The aims of this study is to find out how much influence GDP, exports and investment have on inflation in the five IDB member countries, namely Guinea, Malaysia, Indonesia, Brunei and Jordan. The results obtained by using a quantitative analysis of panel data re-sultations resulted that there was an influence of GDP, exports and investment on inflation but not significantly to these five IDB member countries. Many outlier factors also influenced one of them because the interest-free economy began to be implemented. This study wants to observe what factors influence inflation in the country of Guinea which is one of the IDB member countries that has the poorest characteristics among other countries. The results obtained using quantitative analysis methods of multiple linear regression panel data and classical assumptions produced that the three independent variables affect the dependent variable but not significant. Where the relationship between DGP and inflation is positive, meaning that if GDP rises, inflation also rises. While the relationship between exports and investment to inflation is negative. This means that if exports rise, inflation will decrease and if investment rises, inflation will fall. So in general the government policies of the five IDB member countries must be more pro-aligned to raise the level of exports and investment in the country both foreign investment and domestic investment to help reduce the level of domestic inflation.

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Peran Moderasi Human Capital Diantara Pengaruh PMA dan PMDN Terhadap Pertumbuhan Ekonomi

Ekspansi: Jurnal Ekonomi, Keuangan, Perbankan dan Akuntansi ◽

10.35313/ekspansi.v12i1.1861 ◽

2020 ◽

Vol 12 (1) ◽

pp. 65-76

Author(s):

Islahul amri ◽

Misbahul Munir

Keyword(s):

Economic Growth ◽

Human Capital ◽

Regression Analysis ◽

Money Supply ◽

Foreign Investment ◽

Capital Investment ◽

Series Data ◽

Domestic Investment ◽

Relationship Of ◽

The Relationship

Investment and development of human capital is a major concern for the current government. By increasing the value of domestic and foreign investment and the competence of human capital will increase Indonesia's economic growth. The purpose of this study is to determine the effect of domestic investment and foreign capital investment on economic growth with moderated human capital. This research uses a quantitative approach. The number of samples selected amounted to 10 samples obtained from time series data during the period 2010- 2019. Data analysis methods used were multiple regression analysis and the Moderated Regression Analysis (MRA) test. From the results of the study indicate that domestic investment has a positive and significant effect on the money supply. Foreign Investment has a positive and not significant significant effect on the money supply. Human capital is not able to moderate the relationship of Domestic Investment to economic growth. While human capital can moderate the relationship of Foreign Investment to economic growth.

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PEMODELAN REGRESI SPASIAL INVESTASI LUAR NEGERI YANG MASUK KE INDONESIA

BAREKENG JURNAL ILMU MATEMATIKA DAN TERAPAN ◽

10.30598/barekengvol14iss4pp543-556 ◽

2020 ◽

Vol 14 (4) ◽

pp. 543-556

Author(s):

Muktar Redy Susila ◽

Rizfanni Cahya Putri ◽

Dian Arini

Keyword(s):

Lagrange Multiplier ◽

Foreign Investment ◽

Spatial Regression ◽

P Value ◽

Domestic Investment ◽

West Java ◽

Investment Funds ◽

Foreign Countries ◽

Spatial Dependencies ◽

Monthly Salary

One of the important factors in the growth of a country's economy is investment. Sources of investment are divided into two, namely foreign investment and domestic investment. There are many benefits of foreign investment. These benefits are such as for development, employment, tax revenue, increasing foreign exchange, international trade, strengthening friendship with foreign countries and much more. The purpose of this research is to modeling of foreign investment in Indonesia using spatial regression. The predictor variables used are the number of labor and the net monthly salary. Based on the results of research analysis obtained information that the West Java province is the highest province to get investment funds from abroad. The highest net monthly salary in Indonesia is DKI Jakarta province. The highest number of labor in Indonesia is West Java Province. Based on the results of the Lagrange Multiplier test which showed a significant Lagrange Multiplier (lag) with a p-value < α = 5%. That's shows for the number of labor, the net monthly salary, and the foreign investment in Indonesia fulfill the spatial dependencies assumption. Based on the spatial regression model shows the number of labor, the net monthly salary, and the weighting has a significant impact on foreign investment in Indonesia.

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PENGARUH PENANAMAN MODAL DALAM NEGERI (PMDN) DAN PENANAMAN MODAL ASING (PMA) TERHADAP PRODUK DOMESTIK REGIONAL BRUTO (PDRB) SUMATERA UTARA TAHUN 2000-2018

NIAGAWAN ◽

10.24114/niaga.v9i1.17655 ◽

2020 ◽

Vol 9 (1) ◽

pp. 45

Author(s):

Dede Ruslan ◽

Pebri Hastuti ◽

Dedi Irawan

Keyword(s):

Mathematical Models ◽

Foreign Investment ◽

Quantitative Method ◽

Foreign Capital ◽

Domestic Investment ◽

Domestic Capital ◽

Capital Development ◽

The Relationship ◽

North Sumatra ◽

Domestic Products

This research is titled foreign investment (PMA) and domestic investment (PMDN) on gross regional domestic product (GRDP) in North Sumatra. The purpose of this study was to analyze the effect of PMA and PMDN on GRDP. The method used in this research is a quantitative method that uses mathematical models to present facts or describe statistics to show the relationship between variables namely capital development and domestic investment of regional domestic products in North Sumatra. The results of data processing showed that PMA and PMDN variables in districts / cities in North Sumatra did not have a positive and significant effect on GRDP variables. Meanwhile, procedurally, PMA variable does not have a significant effect on GRDP while PMDN has a positive and significant effect on GRDP. Kata Kunci : Foreign Capital, Domestic Capital, Transition

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Is Foreign Aid Working? The Impact of Foreign Aid on Savings, Investment, and Economic Growth in Haiti

Applied Finance and Accounting ◽

10.11114/afa.v1i1.646 ◽

2015 ◽

Vol 1 (1) ◽

pp. 37

Author(s):

Arché Jean

Keyword(s):

Foreign Aid ◽

Growth Rates ◽

Time Lag ◽

Gdp Growth ◽

Time Lags ◽

Domestic Investment ◽

Regression Analyses ◽

The World ◽

Domestic Savings ◽

The Impact

Despite increases in foreign aid inflow to Haiti, the country remains one of the poorest in the world. Findings regarding the benefits of foreign aid have been inconsistent. The purpose of this quantitative, archival study was to examine the extent to which total foreign aid explained gross domestic savings, gross domestic investment, and GDP growth rates in Haiti from 1975 to 2010 after 3-year, 4-year, and 5-year time lags. Foreign aid was disaggregated into grants and concessional loans. Data were drawn from the World Bank, the International Monetary Fund, and the Organization for Economic Cooperation and Development from 1970 to 2010. To analyze the extent to which total foreign aid predicted gross domestic savings and gross domestic investment, weighted least squares regression analyses were conducted, with per capita income, interest rates, and inflation rates as covariates. To examine the degree to which total foreign aid predicted GDP growth rates, multiple linear regression analyses were conducted, with consumption, government spending, gross domestic investment, and net trade balance as covariates. Foreign aid did not predict gross domestic savings for 3-year time lag, F (5, 30) = 1.32, p =.28; 4-year time lag, F (5, 30) = 1.24, p =.32, or 5-year time lag, F(5,30) = 1.30, p =.15. Foreign aid did not predict gross domestic investment for 3-year time lag, F(5, 30) = 1.49, p =.22; 4-year time lag, F(5,30)= 1.73, p =.16, or 5-year time lag, F(5, 30) = 2.29, p =.07. Foreign aid did not predict GDP growth rates for 3-year time lag, F(6, 29), p =.44; 4-year time lag, F(6, 29) = 1.11, p =.38, or 5-year time lag F(6, 29) = 0.83, p =.56. Findings showed that foreign aid inflows to Haiti have not predicted improved economic development. Future research should focus on determining the relationship between foreign aid and government investment in infrastructure, education, health, and social projects. The discussion should shift from whether foreign aid flows to developing countries are effective to how to make the allocation of foreign aid inflows more effective. The result would be improved use of the inflow of foreign aid and improved economic and social progress in developing nations.

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Dampak Pertumbuhan Inklusi Keuangan terhadap Stabilitas Sistem Keuangan di Indonesia

10.31227/osf.io/vkax8 ◽

2019 ◽

Author(s):

Komang Agus Rudi Indra Laksmana

Keyword(s):

Significant Influence ◽

Growth Rates ◽

Financial Stability ◽

Negative Influence ◽

Financial Inclusion ◽

Gdp Growth ◽

Credit Growth ◽

The Relationship ◽

Significant Direct Effect ◽

Growth Indicators

This study aimed at examining the effect of financial inclusion on the financial stability of banks in Indonesia. The data panel used in the study during the period 2007-2017 and were analyzed using multiple regression, financial inclusion variables using MSME credit growth indicators and GDP growth rates', while the dependent variable banking financial stability used the non-performing loan ratio (NPL) indicator. The results showed that MSME credit growth had a negative influence on credit risk which was associated with better stability. GDP growth rates had a positive and significant direct effect on financial stability (NPL) of banks in Indonesia. At the same time, it had a significant influence as a moderating variable on the relationship between financial inclusion and financial stability of banks in Indonesia.

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Verification of the relationship between FDI and GDP in Poland

Acta Oeconomica ◽

10.1556/032.2016.66.2.6 ◽

2016 ◽

Vol 66 (2) ◽

pp. 307-332 ◽

Cited By ~ 2

Author(s):

Aneta Kosztowniak

Keyword(s):

Decomposition Analysis ◽

Correction Method ◽

Gdp Growth ◽

Domestic Investment ◽

Fdi Inflows ◽

Vector Error Correction ◽

Vector Error ◽

Variance Decomposition Analysis ◽

The Impact ◽

The Relationship

The paper analyses the impact of the factors of production on economic growth in Poland in the years 1992–2012, with particular focus on the impact of foreign direct investment (FDI), and strives to verify whether a causality relationship occurred between GDP and FDI, i.e. whether high GDP dynamics attracted FDI inflows and whether this investment contributed to GDP growth. The Vector Error Correction Method impulse responses and variance decomposition analysis confirmed the bi-directional relationships between FDI and GDP in Poland. However, the impact of GDP on attracting FDI inflows to Poland is stronger than that of FDI on GDP growth. Polish developmental policy should concentrate on three essential determinants (pillars) of growth, namely employment growth, attracting FDI (with emphasis on improvement in the type of inflowing investment), and increasing the value and productivity of domestic investment.

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