Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth

Durham, J. Benson

doi:10.1016/s0014-2921(02)00264-7

Cited by 616 publications

(485 citation statements)

References 37 publications

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“…Contrary to expectations, FDI had a negative impact on economic growth in Slovakia. However, the result is in line with the findings of Durham (2004) for developing countries and of �alik (2015). A possible explanation for the negative effect of FDI on economic growth could be related to the fact that FDI flow consequences are dependent on the technology absorption capacity of the destination states.…”

Section: Data and Discussion Of Resultssupporting

confidence: 91%

Determinants of Economic Growth in V4 Countries and Romania

Simionescu¹,

Lazányi²,

Sopková³

et al. 2017

JOC

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The middle and long-term slowdown in growth dynamics could bring serious social and political problems for V4 countries (Czech Republic, Slovak Republic, Hungary, Poland) and Romania. It would threaten reaching benefits from potential of convergence process with the developed countries of the European Union. As a result, the V4 economies and Romania should find solutions to achieving a sustainable growth that is associated with an improvement of their international competitiveness. This paper provides an empirical analysis of factors that might determine a stable economic growth in the five mentioned countries. The empirical analysis conducted for the period of 2003-2016 employed Bayesian generalized ridge regression. The main results indicated that the FDI promoted economic growth in all countries, except the Slovak Republic. Only in the Czech Republic, the expenditure on education generated economic growth, while the expenditure on R&D had positive effects in Romania, Hungary and the Czech Republic.

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Section: Data and Discussion Of Resultssupporting

confidence: 91%

Determinants of Economic Growth in V4 Countries and Romania

Simionescu¹,

Lazányi²,

Sopková³

et al. 2017

JOC

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“…In particular, in terms of absorptive capacity, the results of text mining support the finding that an influx of FDI brings more benefits to developed countries where human capital is relatively developed [36,37], and that R&D investment in human capital should precede infrastructure investment [47].…”

Section: Text Mining: Tf-idf and Degree Centralitymentioning

confidence: 60%

“…Zhang [35], in a study of eleven developing countries in East Asia and South America, demonstrated that FDI, trade liberalization, export orientation, and human capital have important effects on economic growth. Durham [36] reported that FDI differs depending on the absorption capacity of a host country. He argued that education and openness in developed countries led to greater FDI benefits.…”

Section: Literature Reviewmentioning

confidence: 99%

The Nexus of FDI, R&D, and Human Capital on Chinese Sustainable Development: Evidence from a Two-Step Approach

Park

2018

Sustainability

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This study examines the effect of the foreign direct investment (FDI)-human capital and R&D-human capital interactions (FDIHC and RDHHC) on Chinese development between 1991 and 2015. Based on endogenous growth theory, the study focuses on FDI, R&D, and human capital as important factors for sustained economic growth; the interactions among factors are set as the main variables affecting economic growth (GDP). In particular, this study attempts a two-step empirical analysis. First, data mining and semantic network analysis (SNA) are performed using variables as keywords; reliability and realism are reflected as variables. Second, using the vector error correction model (VECM), the study analyzes short and long run mutual influences between variables. The results show that, in data mining and SNA with FDI and R&D as keywords, words related to human capital show high frequency, centrality, and clustering. This finding implies that FDIHC and RDHHC have robustness as variables and can be used as interaction variables. According to the VECM results, FDIHC and RDHHC have positive influences on GDP in the short and long run. The results of a variance decomposition test show that RDHHC has strong mid-to long-run impacts on GDP, FDIHC, and R&D itself.

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“…The exploitation of spillovers relates to a country's structural characteristics, especially its absorptive capacity (Durham 2004;Görg and Greenaway 2004). Spillover effects from inward FDI materialize more easily when the host country has a minimum stock of human capital or level of economic development (Blomström et al 1994;Borensztein et al 1998).…”

Section: Hypothesismentioning

confidence: 99%

“…Building on the literature on export spillovers, we posit that a country's level of inward and outward FDI, export, and import positively relates to the share of new ventures that focus on serving customers abroad. Furthermore, we speculate that export spillover effects may depend on the country's capacity to absorb such spillovers (Borensztein et al 1998;Durham 2004;Görg and Greenaway 2004;Gugler and Brunner 2007) and, more specifically, that higher-income countries may benefit more from such spillovers than their lower-income counterparts.…”

Section: Introductionmentioning

confidence: 98%

Knowledge spillovers and new ventures’ export orientation

2008

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We draw on the knowledge spillover literature to suggest that a country's proportion of export-oriented new ventures represents an outcome of knowledge spillovers that stem from foreign direct investment (FDI) and international trade (export spillovers) as well as a source of knowledge spillovers (entrepreneurship spillovers). To test the hypotheses, we use macrolevel data from 34 countries during the period 2002-2005. We find that the relationship between FDI and international trade on the one hand and a country's proportion of exportoriented new ventures on the other differs for higher-and lower-income countries. In addition, a country's proportion of export-oriented new ventures affects the subsequent emergence of new businesses.

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Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth

Cited by 616 publications

References 37 publications

Determinants of Economic Growth in V4 Countries and Romania

Determinants of Economic Growth in V4 Countries and Romania

The Nexus of FDI, R&D, and Human Capital on Chinese Sustainable Development: Evidence from a Two-Step Approach

Knowledge spillovers and new ventures’ export orientation

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