Host Country Corporate Tax Rates and Korean Firms' Foreign Direct Investment

2014 ◽  
Vol 18 (3) ◽  
pp. 1 ◽  
Author(s):  
Taeyoung Chung
Keyword(s):  
Foreign Direct Investment ◽  
Host Country ◽  
Direct Investment ◽  
Tax Rates ◽  
Corporate Tax ◽  
Corporate Tax Rates

scholarly journals The Giant Sucking Sound: Is China Diverting Foreign Direct Investment from Other Asian Economies?

2004 ◽  
Vol 3 (3) ◽  
pp. 122-140 ◽  
Author(s):  
Busakorn Chantasasawat ◽  
K. C. Fung ◽  
Hitomi Iizaka ◽  
Alan Siu
Keyword(s):  
Foreign Direct Investment ◽  
Random Effects ◽  
Direct Investment ◽  
Simultaneous Equation ◽  
Southeast Asian ◽  
Equation Model ◽  
Tax Rates ◽  
Simultaneous Equation Model ◽  
Corporate Tax ◽  
Asian Economies

This paper attempts to determine empirically whether China is taking foreign direct investment (FDI) away from other Asian economies (the “China effect”). A random-effects simultaneous equation model, controlling for the determinants of inward FDI of eight East and Southeast Asian economies over 1985–2001 and using China's inward FDI as an indicator of the China effect, indicates that China's FDI level is positively related to these economies' FDI levels and negatively related to their shares in FDI in Asia. Moreover, openness, corporate tax rates, and corruption can exert a greater influence on these countries' FDI than China's FDI.

scholarly journals The Effect of Corporate Profit Tax on Attracting Foreign Direct Investment in Albania

2017 ◽  
Vol 8 (2) ◽  
pp. 186
Author(s):  
Shpresa Cela
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Foreign Direct Investments ◽  
Tax Rates ◽  
Corporate Tax ◽  
Macroeconomic Factors ◽  
Fdi Inflows ◽  
Tax Rate ◽  
Corporate Profit ◽  
Legal Infrastructure

The aim of this study is to analyze the major cause of the instability of foreign direct investments in Albania these last years, their lowest level of FDI when compared with other countries in the region, and the importance of these investments in developing countries like Albania. The size of FDI has a significant effect on the financial and macroeconomic factors, government and infrastructure factors, and the factors by fiscal nature. In this study, we disengage fiscal factors and in particular, the corporate profit tax rate. The aim of this study was to prove that in countries with weak legal infrastructure, this factor is statistically significant in attracting Foreign Direct Investment. Thus, should Albania be considered as a country with weak legal infrastructure? Due to this question, we took into consideration specific indicators measured in recent years by various world organizations by comparing them with various countries of the region. Also, we built an econometric model through multiple regression by collecting data on the tax rate applied in Albania from 1992- 2016, and the level of FDI for this period. This is in a bid to ascertain the effect or impact that profit taxes has on FDI inflows in Albania. In conclusion, Corporate Tax Rates is a factor that has a very significant impact on the size of FDI in Albania.

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.

Economic Policy Uncertainty, Bilateral Investment Treaties, and Chinese Outward Foreign Direct Investment

2021 ◽  
Vol 94 (3) ◽  
pp. 519-557
Author(s):  
Yue Lu ◽  
Linghui Wu ◽  
Ka Zeng
Keyword(s):  
Economic Policy ◽  
Foreign Direct Investment ◽  
Host Country ◽  
Direct Investment ◽  
Policy Uncertainty ◽  
Outward Foreign Direct Investment ◽  
Bilateral Investment Treaties ◽  
Economic Policy Uncertainty ◽  
Chinese Investment ◽  
Investment Treaties

This paper examines the effect of bilateral investment treaties (BITs) in promoting Chinese outward foreign direct investment (COFDI) in the presence of rising economic policy uncertainty in China's partner countries. We postulate that the signing of BITs should help stimulate COFDI because the treaties send a credible signal to foreign investors about the host country's intent to protect Chinese investment, and make it more difficult for the host country to violate its treaty obligations. BITs that contain rigorous investment protection and liberalization provisions, in particular, should be more likely to encourage COFDI as they directly influence Chinese investors' expectations about the stability, predictability, and security of the host market. However, while BITs generally promote COFDI, host country economic policy uncertainty may also limit their effectiveness. This is because uncertainty tends to undermine investor confidence, trigger capital flows from high- to low-risk countries, and dampen commercial activities. Poisson pseudo-maximum likelihood (PPML) estimation models of the determinants of COFDI to 188 countries between 2003 and 2017 lend substantial support to our conjectures.

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