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1 – 10 of over 7000
Article
Publication date: 1 April 2003

Georgios I. Zekos

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some…

86938

Abstract

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

Details

Managerial Law, vol. 45 no. 1/2
Type: Research Article
ISSN: 0309-0558

Keywords

Article
Publication date: 14 May 2018

Neha Saini and Monica Singhania

The purpose of this paper is to investigate the potential determinants of FDI, in developed and developing countries.

9259

Abstract

Purpose

The purpose of this paper is to investigate the potential determinants of FDI, in developed and developing countries.

Design/methodology/approach

This paper investigates FDI determinants based on panel data analysis using static and dynamic modeling for 20 countries (11 developed and 9 developing), over the period 2004-2013. For static model estimations, Hausman (1978) test indicates the applicability of fixed effect/random effect, while generalized moments of methods (GMM) (dynamic model) is used to capture endogeneity and unobserved heterogeneity.

Findings

The outcome across different countries depicts diverse results. In developed countries, FDI seeks policy-related determinants (GDP growth, trade openness, and freedom index), and in developing country FDI showed positive association for economic determinants (gross fixed capital formulation (GFCF), trade openness, and efficiency variables).

Research limitations/implications

The destination of FDI is limited to 20 countries in the present paper. The indicator of the institutional environment, namely economic freedom index, used in this paper has received some criticism in calculations.

Practical implications

The paper enlists recommendations for future FDI policies and may assist government in providing a tactical framework for skill development, thereby increasing manufacturing growth rate. The paper also throws light on vertical and horizontal capital inflows considering resource, strategy, and market-seeking FDI.

Social implications

FDI may bring significant benefits by creating high-quality jobs, introducing modern production and management practices. It highlights how multinational corporations and government contribute to better working conditions in host countries.

Originality/value

The paper uncovers important features like macroeconomic variables, especially country-wise efficiency scores, policy variables, GFCF, and freedom index, for determining FDI inflows in 20 countries using panel data methods and provides a roadmap for developed and developing countries. The study highlights endogeneity and unobserved heteroscedasticity by applying GMM one- and two-step procedure.

Details

Journal of Economic Studies, vol. 45 no. 2
Type: Research Article
ISSN: 0144-3585

Keywords

Article
Publication date: 1 October 1996

Jamuna Prasad Agarwal

Argues that the association of Bulgaria, Hungary, Poland, Romania, Czech and Slovak Republics (CEECs) with the European Union (EU) under “Europe agreements” is unlikely to divert…

4502

Abstract

Argues that the association of Bulgaria, Hungary, Poland, Romania, Czech and Slovak Republics (CEECs) with the European Union (EU) under “Europe agreements” is unlikely to divert any significant amount of foreign direct investment (FDI) from developing countries because most of it in the latter is location specific. Notes that this applies to investments in natural resources, services and manufacturing industries targeting at domestic markets of the host developing countries. Only in the case of footloose labour and pollution intensive branches, developing countries may face additional locational competition from the associated CEECs. But such industries generally have very low shares in total FDI. Moreover, relative costs of production in CEECs are expected to rise in the course of their convergence towards EU standards.

Details

International Journal of Social Economics, vol. 23 no. 10/11
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 5 December 2018

Rania S. Miniesy and MennaTallah Tarek

This paper aims to test the pollution haven hypothesis (PHH) in developing Asian countries by examining whether lax environmental laws are a determinant of foreign direct…

Abstract

Purpose

This paper aims to test the pollution haven hypothesis (PHH) in developing Asian countries by examining whether lax environmental laws are a determinant of foreign direct investment (FDI) inflows into these countries, which are characterised by being the largest FDI recipients among developing countries and also by being among the most highly polluted and the highest carbon dioxide (CO2) emitters worldwide.

Design/methodology/approach

Panel data for the main determinants of FDI inflows including a carbon dioxide emissions and an agglomeration variable are collected for all developing Asian countries for the 1996-2016 period and a fixed effects model with robust standard errors is used.

Findings

Results show that lax environmental laws are a significant determinant of FDI inflows for the selected Asian countries as a whole. A closer look shows that this result cannot be generalised for the whole region, but applies particularly to three countries China, Hong Kong and the Philippines. PHH is thus only partially supported.

Originality/value

FDI is a main engine of growth for developing countries. However, it might adversely affect them, specifically in terms of environmental deterioration in the absence of stringent and well-enforced environmental policies. Some developing countries might even deliberately relax their environmental policies to attain comparative advantage especially in polluting industries and thus attract FDI. This leads to serious repercussions and might eventually limit growth, where augmenting it was the intention in the first place.

Details

Journal of Chinese Economic and Foreign Trade Studies, vol. 12 no. 1
Type: Research Article
ISSN: 1754-4408

Keywords

Article
Publication date: 18 September 2017

Reenu Kumari and Anil Kumar Sharma

The purpose of this paper is to identify key determinants of foreign direct investment (FDI) inflows in developing countries by using unbalanced panel data set pertaining to the…

5505

Abstract

Purpose

The purpose of this paper is to identify key determinants of foreign direct investment (FDI) inflows in developing countries by using unbalanced panel data set pertaining to the years 1990-2012. This study considers 20 developing countries from the whole of South, East and South-East Asia.

Design/methodology/approach

Using seven explanatory variables (market size, trade openness, infrastructure, inflation, interest rate, research and development and human capital), the authors have tried to find the best fit model from the two models considered (fixed effect model and random effect model) with the help of Hausman test.

Findings

Fixed effect estimation indicates that market size, trade openness, interest rate and human capital yield significant coefficients in relation to FDI inflow for the panel of developing countries under study. The findings reveal that market size is the most significant determinant of FDI inflow.

Research limitations/implications

Like any other study, this work also has some limitations. Lack of data on key determinants such as labor cost, exchange rate, corruption, natural resources, effectiveness of rule of law and political risk may be considered one such limitation. Further, controlling for variables such as exchange rate, corruption, labor cost and political risk could make significant improvements to this study.

Practical implications

This study has significant implications for policy makers, mangers and investors. Policy makers would be able to understand the importance of the major determinants of FDI mentioned in the paper, and take steps to formulate policies that encourage FDI. Such measures could include developing market size, making regulations more international trade friendly and investing in the nation’s human capital. Further, steps could be taken to keep interest rates and inflation rates under control as these factors have been found to influence FDI.

Originality/value

The sample of 20 developing nations chosen for this study has not been considered by any study earlier. This is a unique contribution to existing body of research, and highlights the originality value of this paper.

Details

International Journal of Emerging Markets, vol. 12 no. 4
Type: Research Article
ISSN: 1746-8809

Keywords

Open Access
Article
Publication date: 13 April 2023

Van Bon Nguyen

The study aims to use individuals using the internet and fixed broadband subscriptions as a proxy for digitalization to empirically assess the effects of Foreign Direct Investment…

1804

Abstract

Purpose

The study aims to use individuals using the internet and fixed broadband subscriptions as a proxy for digitalization to empirically assess the effects of Foreign Direct Investment (FDI), digitalization and their interaction on income inequality in developed and developing countries from 2002 to 2019.

Design/methodology/approach

The paper used the system general method of moments estimators for 30 developed and 35 developing countries.

Findings

FDI increases income inequality in developed countries but decreases it in developing countries, digitalization reduces income inequality in both groups and interaction term narrows income inequality in developed countries but widens it in developing countries.

Originality/value

The paper is the first to introduce digitalization into the FDI – income inequality relationship. Furthermore, it provides empirical evidence to show the difference in the role of digitalization in this relationship between developed and developing countries.

Details

Journal of Economics, Finance and Administrative Science, vol. 28 no. 55
Type: Research Article
ISSN: 2218-0648

Keywords

Article
Publication date: 1 September 2002

Alvin G. Wint and Densil A. Williams

This study examines the efforts of many developing countries to promote their economies as sites for foreign direct investment. It develops a model of determinants of foreign…

10551

Abstract

This study examines the efforts of many developing countries to promote their economies as sites for foreign direct investment. It develops a model of determinants of foreign direct investment flows to test the extent to which countries are able to differentially attract foreign direct investment through promotional activities. The statistical study lends support to the concept that the convergence of policy and promotional activities around the developing world is leading to a movement toward the maturity phase of the life cycle of the differential effectiveness of special attraction efforts. While this trend does not support a discontinuation of these special attraction efforts, we do suggest that it does make it critical that promotional organizations in developing countries emphasize “functional” rather than “selective” policy reforms and promotional activities that are non‐discriminatory in relation to local investors.

Details

International Journal of Public Sector Management, vol. 15 no. 5
Type: Research Article
ISSN: 0951-3558

Keywords

Article
Publication date: 8 June 2021

Neha Singh and Cheshta Kapuria

This paper aims to analyse, the issue concerning the quality of inward foreign direct investments (FDI) by empirically investigating the role of four sustainability determinants…

Abstract

Purpose

This paper aims to analyse, the issue concerning the quality of inward foreign direct investments (FDI) by empirically investigating the role of four sustainability determinants of FDI, namely, economic, environmental, social and governance using data from 22 developing countries of the Asian region over a period from 2000–2016.

Design/methodology/approach

The methodology adopted to achieve this purpose is dynamic panel estimation (two-step difference generalised method of moments) by developing three econometric models. The data is sourced from the World Development, Worldwide Governance Indicators, International Telecommunication Union and the United Nations Conference on Trade and Development.

Findings

The econometric results indicate that, in general, control of corruption, political stability and electricity consumption influence sustainable FDI favourably; and CO2 emissions lower the extent of sustainable FDI. The result underlines deficiencies in the information technology aspect, which has a non-significant yet positive relationship with sustainable FDI. A pertinent finding of this study is that the past value of FDI inflows increases the current year’s FDI inflows in developing countries.

Practical implications

The findings related to gender and information technology aspects found in this paper will be of interest to both researchers and policymakers for substantially reorienting the sustainability attributes to foreign investment.

Originality/value

The authors’ main contributions are to encapsulate the conceptual framework into an empirical model by combining all the four dimensions, namely, environmental, economic, social and governance for developing countries.

Details

Social Responsibility Journal, vol. 18 no. 4
Type: Research Article
ISSN: 1747-1117

Keywords

Article
Publication date: 2 September 2013

Yang Yang, Xiaohua Yang and Barry W. Doyle

There has been a surge of overseas investment from China, both to developing and developed countries. However, there is limited understanding of the impact the…

1271

Abstract

Purpose

There has been a surge of overseas investment from China, both to developing and developed countries. However, there is limited understanding of the impact the internationalization of these firms has on their value creation. This paper seeks to draw on the reconciled FSA/CSA framework with Dunning's four motives to differentiate two types of FDI: traditional FDI and strategic asset-seeking FDI. Further, the paper draws on Verbeke's FSA/CSA recombination process model to analyze the differentiated value creation of traditional FDI and strategic asset-seeking FDI for the Chinese MNEs.

Design/methodology/approach

The paper adopts event study methodology to measure the value created by Chinese MNE's FDI projects and hierarchical linear regression to test the hypotheses. The sample consists of 121 FDI projects publicly announced by Chinese listed companies during 2001-2009.

Findings

Both traditional and strategic asset-seeking FDI create value and traditional FDI creates more value than strategic asset-seeking FDI for Chinese MNEs. In addition, the paper empirically demonstrates that traditional FDI into developing countries creates more firm value than traditional FDI into developed countries or strategic asset-seeking FDI into developed countries.

Originality/value

This research makes the following original contributions: it contributes to the growing body of literature on internationalization of Chinese firms by investigating whether international expansion creates firm value and how the alignment between types of FDI and location strategies influences firm value creation; the study contributes to the literature by providing insights into the performance implications of emerging economy enterprises (EEEs); and the research contributes to FDI theory building by incorporating learning concepts in internationalization theories and by extending the context of internationalization theories to that of EEEs.

Details

Multinational Business Review, vol. 21 no. 3
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 26 October 2012

Marie Freckleton, Allan Wright and Roland Craigwell

The purpose of this paper is to examine the relationship between economic growth, foreign direct investment (FDI) and corruption.

8800

Abstract

Purpose

The purpose of this paper is to examine the relationship between economic growth, foreign direct investment (FDI) and corruption.

Design/methodology/approach

Data for 42 developing countries and 28 developed countries is analyzed using panel dynamic ordinary least squares.

Findings

FDI has a significant influence on economic growth in both the short run and the long run for developing and developed countries. In the cases of the developing economies, lower levels of corruption enhance the impact that FDI has on economic growth.

Originality/value

The study links corruption to the impact of FDI on economic growth.

Details

Journal of Economic Studies, vol. 39 no. 6
Type: Research Article
ISSN: 0144-3585

Keywords

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