Foreign direct investment in the czech manufacturing sector

1997 ◽  
Vol 6 (2) ◽  
Author(s):  
Vladimír Benáček ◽  
Alena Zemplinerová
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Foreign Capital ◽  
Manufacturing Sector ◽  
Value Added ◽  
Salient Feature ◽  
Physical Capital ◽  
Manufacturing Industries ◽  
Input Side ◽  
Capital Intensive

In the period of 1991-96 there were large volumes of foreign direct investment directed to various Czech manufacturing industries and services. Our empirical analysis has shown that enterprises of the manufacturing sector, into which the foreign capital was invested, were generally physical capital intensive and labor saving. At the same time, both capital and labor efficiencies in firms with FDI have been significantly above the domestic average. Another salient feature of the FDI enterprises is that they are very export intensive and, on the input side, they have a higher proportion of material inputs and thus relatively lower proportion of value added.

scholarly journals Modeling the impact assessment of agricultural sector on economic development as a basis for the country’s investment potential

2019 ◽  
Vol 16 (3) ◽  
pp. 229-240
Author(s):  
Alina Bukhtiarova ◽  
Arsen Hayriyan ◽  
Victor Chentsov ◽  
Sergii Sokol
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Agricultural Sector ◽  
Negative Impact ◽  
Manufacturing Sector ◽  
Value Added ◽  
The Cost ◽  
The Impact

In the context of countries integration into the world economic space, agricultural sector is one of the priorities and strategically important sectors of the national economy. Development of instruments aimed to increase investment potential of this sector is therefore an important component of the country’s economy growth. The article proposes a science-based model of the impact of the agricultural sector on the economic development level of countries trying to move towards European integration.It was found that the employment rate (+58.4) has the largest influence on the rate of GDP change in the studied group of countries (Ukraine, Moldova, Georgia, Armenia). The impact of the gross value added of the manufacturing sector on its economic growth is positive (+44.6). The negative foreign direct investment ratio in the model (–40.3) may be due to the fact that the indicator in the studied countries is still largely influenced by the intervention of the state mechanism, significant uncertainty and risk, which is a deterrent to the overall economic development. An important result of the study was that foreign direct investment had a negative impact on economic growth in developing countries. Further development of the investment potential of a country’s agricultural sector provides for a radical acceleration of scientific and technological progress and, on this basis, a reduction in the cost of a unit of agricultural products and food and an increase in their competitiveness in the domestic and world markets.

scholarly journals Foreign direct investment as a stimulant in productivity convergence process between Visegrad Countries and UE-15

2017 ◽  
Vol 6 (326) ◽  
Author(s):  
Liwiusz Wojciechowski
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Foreign Capital ◽  
Value Added ◽  
Developed Countries ◽  
Real Convergence ◽  
Convergence Process ◽  
Savings Rate ◽  
Visegrád Countries

The explanation of reasons and degree of differentiation of wealth between countries remains an important issue in economics today. Theories of economic growth are focused principally on the identification of the long-term determinants of diversification of sources and economic growth, which in turn is associated with the notion of real convergence. Given the supply role of foreign capital that impacts on the economy, in the face of dynamic inflow of foreign direct investment (FDI) into developing countries’ economies, it seems reasonable to include it in convergence process modelling, especially in the modelling of the convergence of productivity. The productivity of the economy is in fact determined by the size of the capital accumulation (both domestic and foreign), savings rate and a number of other conditions. The author hypothesized that the presence of FDI contributes to the acceleration of pace of real convergence between Visegrad countries and EU-15. In this study we estimate interactions between FDI and productivity at both national and NACE level in the years 2000–2014. We concider, in panel data form, among others, productivity in terms of gross value added per employee, degree of penetration of FDI in the economy of the host country. Results suggest conditional β-convergence of productivity existence however they vary across countries, sectors and time. The analysis provides recommendations regarding the arguments for the sectoral policy aimed at encouraging foreign capital to increase its involvement, focusing on reducing productivity gap between the developing and developed countries belonging to European Union.

FOREIGN DIRECT INVESTMENTS AND MANUFACTURING SECTOR PERFORMANCE IN NIGERIA, (1970-2009)

2013 ◽  
Vol 03 (04) ◽  
pp. 39-56
Author(s):  
Adejumo Akintoye Victor
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Manufacturing Industry ◽  
Manufacturing Sector ◽  
Value Added ◽  
Foreign Direct Investments ◽  
Long Run ◽  
Negative Effect ◽  
Sector Performance ◽  
The Relationship

The study examined the relationship between foreign direct investment and the value added to the manufacturing industry in Nigeria, between the period 1970 and 2009. In view of the development and industrialising desires of Nigeria, as well as the foreign aid received in form of private investments, it is pertinent to examine the effect the presence of multinationals has had in shaping the Nigerian manufacturing industry. Using the autoregressive lag distribution technique to determine the relationship between foreign direct investment and manufacturing value added, it was discovered that in the long-run, foreign direct investments have had a negative effect on the manufacturing sub-sector in Nigeria.

Malaysia's Response to the China Challenge

2003 ◽  
Vol 2 (2) ◽  
pp. 46-73 ◽  
Author(s):  
Zainal Aznam Yusof
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Manufacturing Sector ◽  
Free Trade Agreements ◽  
Trade Agreements ◽  
Manufacturing Industries ◽  
Policy Recommendations ◽  
Policy Options ◽  
Electronics And Electrical ◽  
Opening Up

Malaysia is a rapidly growing and resource-rich country that has been industrializing since the late 1960s. Its industrialization has relied on the growth of labor-intensive industries, particularly the electronics and electrical-products industries, which have contributed significantly to the growth of the manufacturing sector. The growth and opening up of China has raised concerns about Malaysia's loss of competitiveness to China and the diversion of foreign direct investment to China. This paper examines the relative competitive position of Malaysia and China and explores Malaysia's responses and policy options, both international and national, to the challenges posed by China. The following policy recommendations for Malaysia are explored: working intensively with its partners in ASEAN to develop a common stand with regard to trade arrangements, forming bilateral free trade agreements with selected countries, restructuring Malaysia's manufacturing industries so they are far less dependent on labor-intensive industries, and improving the education and technological skills of Malaysia's labor force.

A Comparative Analysis of the Patterns of Japanese and Korean Foreign Direct Investment in China

2012 ◽  
pp. 309-324 ◽  
Author(s):  
Jai S. Mah ◽  
Sunyoung Noh
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Manufacturing Sector ◽  
Value Added ◽  
Chinese Economy ◽  
The Past ◽  
Employment Generation ◽  
Japanese Fdi ◽  
Investment In China ◽  
Opening Up

The current paper compares the patterns of Japanese outward foreign direct investment (OFDI) in China with that of Korea. As a result of the opening up of the Chinese economy together with the accumulating foreign exchange reserves, their FDI in China has risen over the past decades. The share of Japanese FDI in China has remained less than 20 percent of Japanese OFDI as a whole, while Korean FDI in China reached two-fifths of its total OFDI. The gravity model appears to be suitable for explaining the pattern of Korean FDI in China. By industries, the manufacturing sector has accounted for as much as or over three quarters of Japanese and Korean FDI in China. The former appears to be focused more on value-added industries such as machinery contributing to transfer of advanced technologies, while the latter is relatively more concentrated on labor intensive industries contributing to employment generation.

scholarly journals Nexus of Foreign Direct Investment, Domestic Investment, and Manufacturing Industry Value Added in Indonesia

2019 ◽  
Vol 8 (1) ◽  
pp. 1-8
Author(s):  
Horas Djulius ◽  
Choi Wongyu ◽  
J. Juanim ◽  
Raeni Dwi Santy
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Manufacturing Industry ◽  
Value Added ◽  
Domestic Investment ◽  
Panel Data Regression ◽  
Data Regression ◽  
Comparison Results ◽  
Industrial Samples ◽  
Capital Intensive

The development of the manufacturing industry is one of the standards for Indonesia's development as a developing country. Domestic investment (DI) and foreign direct investment (FDI) can meet investment needs in this industry. This paper focuses on the nexus of the two types of investment in meeting investment needs in the manufacturing industry and the influence of those investments in relatively capital-intensive and relatively labor-intensive industrial groups. The aim is to evaluate the role of both types of investments and their benefits to the economy not only to the value-added but also in transferring technology and knowledge spillover from FDI to DI. The panel data regression was first to do to observe the differences between groups of relatively capital-intensive industrial samples and relatively labor-intensive industrial samples. The comparison results show that there are significant differences between the two industry groups so that it can be regressed on these two sample types, apart from the regression of the overall sample. The overall sample found that both FDI and DI influence the value-added of the manufacturing industry. 

scholarly journals Essays on Foreign Direct Investment, International Trade, and Inequality

2021 ◽  
Author(s):  
Minh Nam Ngo
Keyword(s):  
Foreign Direct Investment ◽  
International Trade ◽  
Vocational Education ◽  
Direct Investment ◽  
Manufacturing Sector ◽  
Tertiary Education ◽  
Value Added ◽  
The United States ◽  
High Tech ◽  
The Impact

<p>This thesis consists of three empirical essays on the impact on inequality of Foreign Direct Investment (FDI), international trade, and technological progress that comes with them. The first essay examines whether FDI contributes towards income convergence of the host country, drawing evidence from provincial data in Vietnam. Using the spatial econometrics approach and an exogenous set of distance-based weights to characterize spatial dependences, we identify the substantial role of both spatial interactions and FDI spillovers in bringing provinces closer together in terms of income level. We show that high-tech FDI and industry FDI agglomerations contribute significantly more towards the convergence process than low-tech FDI and agglomerations formed by FDI firms coming from the same country. A similar pattern also emerges when we consider consumption convergence. The second essay studies the impact of local labour demand shocks from FDI firms on wage distribution, using microdata from the Vietnam Household Labour Force Survey. We use Bartik shift-share instrument based on the interaction between predetermined local employment structure and time-varying nationwide employment to deal with the endogeneity between local wage level and multinational firms’ locational decisions. Overall, we find that surges in foreign hiring increase average local wage, but the benefits are considerably higher for workers who work in lower-skilled occupations or have lower educational attainments. Given the prevailing skill and education wage premium, this heterogeneous effect provides evidence that the presence of FDI firms can reduce wage inequality. The third essay analyzes the association between income inequality, dependence on the manufacturing sector, and the availability of vocational education as an alternative track to general tertiary education. We find that in countries where tertiary and vocational are the two main available pathways for students to pursue, as economic recovery, trade, and automation increases the value-added of the manufacturing sector but decreases the number of manufacturing jobs, improving access to vocational education is associated with a larger decline in inequality compared to tertiary education. Therefore, in the long run, limited public resources should be directed towards vocational education in order to smooth out adjustment to trade and skilled-biased technological change. A case study comparing the United States and Germany in terms of their recovery paths from the Global Financial Crisis provide further evidence for our claims.</p>

scholarly journals Essays on Foreign Direct Investment, International Trade, and Inequality

2021 ◽  
Author(s):  
Minh Nam Ngo
Keyword(s):  
Foreign Direct Investment ◽  
International Trade ◽  
Vocational Education ◽  
Direct Investment ◽  
Manufacturing Sector ◽  
Tertiary Education ◽  
Value Added ◽  
The United States ◽  
High Tech ◽  
The Impact

<p>This thesis consists of three empirical essays on the impact on inequality of Foreign Direct Investment (FDI), international trade, and technological progress that comes with them. The first essay examines whether FDI contributes towards income convergence of the host country, drawing evidence from provincial data in Vietnam. Using the spatial econometrics approach and an exogenous set of distance-based weights to characterize spatial dependences, we identify the substantial role of both spatial interactions and FDI spillovers in bringing provinces closer together in terms of income level. We show that high-tech FDI and industry FDI agglomerations contribute significantly more towards the convergence process than low-tech FDI and agglomerations formed by FDI firms coming from the same country. A similar pattern also emerges when we consider consumption convergence. The second essay studies the impact of local labour demand shocks from FDI firms on wage distribution, using microdata from the Vietnam Household Labour Force Survey. We use Bartik shift-share instrument based on the interaction between predetermined local employment structure and time-varying nationwide employment to deal with the endogeneity between local wage level and multinational firms’ locational decisions. Overall, we find that surges in foreign hiring increase average local wage, but the benefits are considerably higher for workers who work in lower-skilled occupations or have lower educational attainments. Given the prevailing skill and education wage premium, this heterogeneous effect provides evidence that the presence of FDI firms can reduce wage inequality. The third essay analyzes the association between income inequality, dependence on the manufacturing sector, and the availability of vocational education as an alternative track to general tertiary education. We find that in countries where tertiary and vocational are the two main available pathways for students to pursue, as economic recovery, trade, and automation increases the value-added of the manufacturing sector but decreases the number of manufacturing jobs, improving access to vocational education is associated with a larger decline in inequality compared to tertiary education. Therefore, in the long run, limited public resources should be directed towards vocational education in order to smooth out adjustment to trade and skilled-biased technological change. A case study comparing the United States and Germany in terms of their recovery paths from the Global Financial Crisis provide further evidence for our claims.</p>

Corporate Taxes and Foreign Direct Investment: An Impact Analysis

2020 ◽  
Vol 5 (2) ◽  
pp. 28-43
Author(s):  
Onome Christopher Edo ◽  
Anthony Okafor ◽  
Akhigbodemhe Emmanuel Justice
Keyword(s):  
Foreign Direct Investment ◽  
Error Correction ◽  
Direct Investment ◽  
Impact Analysis ◽  
Negative Relationship ◽  
Value Added ◽  
Positive Association ◽  
Error Correction Model ◽  
Corporate Taxes ◽  
Correction Model

Objective – The purpose of this study is to investigate the effect of corporate taxes on the flow of Foreign Direct Investment (FDI) in Nigeria between 1983 and 2017. Methodology/Technique – This study adopts an ex-post facto research design. Secondary data was sourced from the World Bank Development Indicator, the Central Bank of Nigeria database, and the Federal Inland Revenue database. The research data was analyzed using the Error Correction Model (ECM). Findings – The coefficient of determination (R2) shows that approximately 77% of systematic changes in FDI are attributed to the combined effect of all of the explanatory variables used in this study. Specifically, the study concludes that Company Income Tax, Value Added Tax, and Custom and Excise Duties have a significant but negative relationship with FDI. In contrast, Tertiary Education Tax has a positive association with FDI. Further, Exchange Rate has a negative but significant relationship with FDI, Inflation had an insignificant but positive association with FDI, and GDP growth Rate and Trade Openness demonstrate a positive and significant association with FDI. Novelty – The findings of this study are distinguishable from previous studies, as it uncovers new evidence that higher Education Tax Rates influences FDI and emerging evidence on the effect of non-tax variables on FDI inflow. Type of Paper: Empirical. JEL Classification: E22, F21, H2, P33. Keywords: Corporate Taxes; Foreign Direct Investment; Error Correction Model; Nigeria; Non-Tax Variables. Reference to this paper should be made as follows: Edo, O.C; Okafor, A; Justice, A.E. 2020. Corporate Taxes and Foreign Direct Investment: An Impact Analysis, Acc. Fin. Review 5 (2): 28 – 43. https://doi.org/10.35609/afr.2020.5.2(1)

Attracting foreign capital as a factor in ensuring the country's economic growth

2020 ◽  
pp. 34-41
Author(s):  
Taras Malyshivskyi ◽  
Volodymyr Stefinin
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Foreign Direct Investment ◽  
Low Income ◽  
Direct Investment ◽  
Foreign Capital ◽  
Local Level ◽  
Current Trend ◽  
Raw Material ◽  
Foreign Capital Inflows

The article examines the relationship between attracting foreign capital in the form of foreign direct investment and ensuring economic development. In particular, the analysis of the current structure of the economy is indicated, its raw material character is pointed out and, based on other researches, the necessity of its reform is substantiated, as Ukraine will remain a low-income country if the current trend continues. This is due to the fact that countries with a raw material structure of the economy are characterized by a low level of economic complexity, and therefore are not able to generate high levels of income in society. As a result, the expediency of stimulating the attraction of investment resources into the country’s economy, in particular in the form of foreign direct investment, is substantiated. The dynamics of attracting foreign direct investment to Ukraine and a number of other countries for the period from 1991 to 2019 is analyzed and the key negative factors that deter foreign investors from investing in the economy of Ukraine are indicated. As a result of the analysis, divergent trends in the economic development of Ukraine and other analyzed countries (Poland, Czech Republic, Slovakia, Turkey, Romania, Hungary) were identified, which contributed to economic stagnation and restrained economic growth and development. Taking into account the analysis, as well as based on the concept of investment and innovation growth, it is proposed to use the experience of Israel to improve the country’s investment attractiveness and stimulate foreign capital inflows by adapting the Yozma program to Ukrainian realities. According to our estimates, the adaptation of this program to the Ukrainian economy will attract about $ 350 million over a five-year period of venture capital alone. In addition, programs such as YOSMA can also be implemented at the regional or even local level. We believe that the use of this tool will improve the investment attractiveness of the country, as well as provide sufficient financial resources to modernize the domestic economy and ensure rapid economic growth.

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