Trade and foreign direct investment in Latin America and Southeast Asia: temporal causality analysis

Mello, Luiz R. de; Fukasaku, Kiichiro

doi:10.1002/1099-1328(200010)12:7<903::aid-jid695>3.0.co;2-8

Cited by 33 publications

(18 citation statements)

References 26 publications

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“…Also, sound economic strategies may boost both economic growth and FDI; the empirical results are not consistent with the prospect of FDI exerts a positive effect on growth that is independent of other growth determinants (Carkovic & Levine, 2002). Moreover, Mello, Luiz, and Fukasaku (2000) study analyze the selected Latin American and Southeast Asian economies over the period . They discover that the imports precede FDI is conveyed by their empirical outcomes in Latin America for Argentina, Ecuador, and Peru.…”

Section: Empirical Literaturementioning

confidence: 88%

The role of FDI inflows and export on economic growth in Sri Lanka: An ARDL approach

Sultanuzzaman

Fan

Akash³

et al. 2018

Cogent Economics & Finance

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This paper examines the long-run and short-run relationship between Foreign Direct Investment (FDI) inflows, exports, and economic growth in Sri Lanka over 1980-2016. The study implies Autoregressive Distributed Lag (ARDL) bounds testing approach to reveal the relationship between the variables. The study indicates that FDI inflows have a positive and significant relationship with economic growth in the long-run and short run. If FDI inflows increase, GDP growth will increase. But for exports, it has a negative and significant relationship with economic growth in the long-run. If exports increase, the GDP growth will decrease. Sri Lankan exports strongly depend on primary goods. There is a risk of finite resources and price volatility. It's not surprising for developing economy like Sri Lanka. Also, in the short run, exports have a positive and significant relationship with economic growth. If exports increase, GDP growth will increase significantly. The findings suggest that both FDI inflows and exports influence economic progress in Sri Lanka. Based on emerging market economies, FDI inflows are useful in improving the production process in the host country, and hereafter it will contribute to quality exports and the economic growth of Sri Lanka. Policymakers should emphasize to gear up all the barriers for the economic development of Sri Lanka.

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Section: Empirical Literaturementioning

confidence: 88%

The role of FDI inflows and export on economic growth in Sri Lanka: An ARDL approach

Sultanuzzaman

Fan

Akash³

et al. 2018

Cogent Economics & Finance

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“…Knowledge spillovers from trade can occur through import of intermediate inputs and high-tech 2 merchandise and services, while that from FDI can occur through channels of backward linkages (Javorcik 2004), vertical linkages in the form of spillovers to suppliers and customers (Lall 1980), worker mobility (Blomström and Kokko 1998) and demonstration effects in the form of imitation and reverse engineering (Saggi 2006). Yet, irrespective of the nature of spillovers through trade and FDI, empirical evidence remains inconclusive regarding their exact relationship (Fontagné 1999;De Mello and Fukasaku 2000).…”

Section: Introductionmentioning

confidence: 99%

Knowledge Spillovers Through FDI and Trade: The Moderating Role of Quality-Adjusted Human Capital

Ali

Cantner

Roy

2017

Foundations of Economic Change

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The paper extends the findings of Coe and Helpman (1995) model of R&D spillovers by considering foreign direct investment (FDI) as a channel for knowledge spillovers in addition to imports. Deeper insights on the issue are provided by examining inter-relationship between knowledge spillovers from imports and inward FDI. Moreover, human capital is added to the discussion as one of the appropriability conditions for knowledge spillovers. However, in comparison to most studies that rely on physical, monetary or indicator-based measures of human capital, the current study proposes a quality-based indicator of human capital that allows for better comparison of human capital stock across countries. Quality adjusted human capital is derived by weighting human capital data based on average years of schooling using journal publications in science and technology and patent applications. Using cointegration estimation method on 20 European countries from 1995 to 2010, the direct effects of FDI-related as well as import-related spillovers on domestic productivity are confirmed. Furthermore, a strong complementary relationship is found between knowledge spillovers through the channels of imports and inward FDI implying strong joint effect on domestic productivity. When considering quality-adjusted human capital, countries with better human capital are found to benefit not only from direct productivity effects, but also from absorption and transmission of international knowledge spillovers through imports and inward FDI. Finally, technological distance with the frontier does not appear to play a role in the absorption of knowledge spillovers. Terms of use: Documents in

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“…IMPORTS IN SPAIN 2 1 But, while there are theoretical arguments that support both substitution and complementary effects, empirical works on this question (although scarcely tested) nearly always show a net complementarity relationship between imports and foreign direct investment, regardless of the country analyzed, the methodology or the data sets employed. For instance, de Mello and Fukasaku (2000), by means of bivariate vector error-correction models and causality analysis, show that a positive relationship between imports and FDI inflows exists in some of the Latin American and Southeast Asian countries selected. Similarly, Brainard (1997), in an effort to test her proximity-concentration hypothesis, observes that foreign affiliate sales and imports in US are positively related to one a n~t h e r .~ Her theory in the explanation of FDI in fact constitutes the starting point of some recent works that analyze the connection between imports and FDI inflows using gravity models.…”

Section: Introductionmentioning

confidence: 99%

Inward Foreign Direct Investment and Imports in Spain

Alguacil

Orts

2003

International Economic Journal

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In this paper, we investigate the links between inward foreign direct investment and imports in Spain. We show that FDI in this country has been trade-oriented, encouraging greater imports. Foreign production thus magnifies its potential gains with the conventional benefits of trade. A cointegration analysis in a multivariate VAR model is applied for Granger temporal causality testing. The strength and direction of the causal relationship are shown through the dynamic variance decomposition and the impulse response technique. [Fl0, F20, F21]

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Trade and foreign direct investment in Latin America and Southeast Asia: temporal causality analysis

Cited by 33 publications

References 26 publications

The role of FDI inflows and export on economic growth in Sri Lanka: An ARDL approach

The role of FDI inflows and export on economic growth in Sri Lanka: An ARDL approach

Knowledge Spillovers Through FDI and Trade: The Moderating Role of Quality-Adjusted Human Capital

Inward Foreign Direct Investment and Imports in Spain

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