scholarly journals Effects of foreign direct investment on the restructuring of the see economies

2015 ◽  
pp. 543-555
Author(s):  
Natasa Stanojevic ◽  
Slobodan Kotlica
Keyword(s):  
Foreign Direct Investment ◽  
Transition Economies ◽  
Direct Investment ◽  
Economic Transformation ◽  
Positive Contribution ◽  
Managerial Practices ◽  
Technology Transfers ◽  
Negative Effect ◽  
Important Means

This paper considers the role of foreign direct investment (FDI) in the transformation and development of post-socialist transition economies, with some particular review of the example of Republic of Serbia. Given the post-socialist countries had a significant deficiency of inner capacities, FDI was considered as the most important means of providing financial capital, technologies, organizational and managerial practices and access to foreign capital markets. Such expectations were supported by the theories of positive contribution of FDI to the economic transformation of transition countries. Over the past decade, transition economies have been the fastest-growing host for FDI, but there are not expected results. FDI has not contributed much to the industrial improvement or to the promotion of competitiveness and exports, and the new empirical evidence even points to negative effect of FDI penetration on domestic market. Considering the great disparity between potential and realized effects of FDI on the economic development of these economies, this paper explores the main sources of failure. The first is the type of FDI, with predominating acquisitions and privatizations along with less sophisticated technology transfers; the second refers to the sectoral distribution, primarily in non-tradable services and goods, which means that FDI contributes only to the market spread of the investors. These features of FDI created the mechanisms of disarticulation of host economies, with a decrease in economic growth as a result.

Light Manufacturing in Ethiopia

2019 ◽  
pp. 703-720
Author(s):  
Cornelia Staritz, PhD ◽  
Lindsay Whitfield, PhD
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
The United States ◽  
Economic Transformation ◽  
Industrial Policies ◽  
Export Industry ◽  
Export Sector ◽  
Labour Costs ◽  
Industrial Parks

The apparel export industry in Ethiopia has increased significantly since the 2000s. Apparel exports emerged due to low labour costs and preferential trade agreements with the United States and European Union, but more importantly to proactive government industrial policies and the decisions of US and EU buyers and core suppliers to invest in or source from Ethiopia. Foreign direct investment has played an important role in the growth of the apparel export industry, but there exist also locally owned export firms. Sector-specific industrial policies are divided into three phases: incentivizing local investment in apparel exporting; addressing constraints facing local export firms and attracting foreign direct investment; and promoting foreign and local investment within specialized industrial parks. This chapter provides an overview of the development of the apparel export sector in Ethiopia, highlighting the role of industrial policy and the performance of locally owned firms given their importance in economic transformation.

Foreign direct investment in European transition economies—The role of policies

2007 ◽  
Vol 35 (2) ◽  
pp. 369-386 ◽  
Author(s):  
Dimitri G. Demekas ◽  
Balázs Horváth ◽  
Elina Ribakova ◽  
Yi Wu
Keyword(s):  
Foreign Direct Investment ◽  
Transition Economies ◽  
Direct Investment

scholarly journals International trade and foreign direct investment as growth stimulators in transition economies: does the impact of institutional factors matter?

2017 ◽  
Vol 14 (4) ◽  
pp. 148-170 ◽  
Author(s):  
Antonis Tsitouras ◽  
Athanasios Koulakiotis ◽  
Georgios Makris ◽  
Harry Papapanagos
Keyword(s):  
Foreign Direct Investment ◽  
International Trade ◽  
Transition Economies ◽  
Direct Investment ◽  
Fixed Effects ◽  
Generalized Method Of Moments ◽  
Physical Capital ◽  
Positive Contribution ◽  
Institutional Variables ◽  
The Impact

The present paper develops a general production function framework, augmented with two institutional variables namely bureaucracy and corruption on 28 transition economies over the period 2000-2015. The authors use various econometric specifications and apply both the Fixed Effects, as well as the advanced system Generalized Method of Moments (GMM) panel data techniques. Empirical findings suggest that the impact of openness in terms of foreign direct investment and international trade is advantageous to all the economies of the panel. Furthermore, the findings indicate that classical growth determinants, such as labor and physical capital, have the expected positive contribution, while macroeconomic instability has a negative effect on real economic activity. Regarding the impact of the two institutional variables, corruption, and bureaucracy, the authors retrieve more influential results, as their impact appears to be diametrically opposite between the former Soviet Union states and the rest of European transition economics.

scholarly journals Foreign Direct Investment In Transition Economies: An Institutional Approach

2011 ◽  
Vol 6 (12) ◽  
Author(s):  
Agim Kukeli
Keyword(s):  
Foreign Direct Investment ◽  
Transition Economies ◽  
Direct Investment ◽  
Physical Capital ◽  
Seemingly Unrelated Regression ◽  
Institutional Setting ◽  
Diffusion Of Technology ◽  
Institutional Approach ◽  
Unrelated Regression

Foreign direct investment (FDI thereafter) is very important for economic growth in transition economies. They have major impact in economic development as a source of physical capital, diffusion of technology, improvements in management and marketing techniques, and enhancing institutional setting of these economies toward market oriented. In this paper, an institutional approach to FDI inflow is investigated to identify relevant factors that have shaped and influenced transition economies. The role of institutions in the inflow of FDI in transition economies is estimated empirically by using Seemingly Unrelated Regression Estimation (SURE) technique.

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