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Open Access
Article
Publication date: 28 November 2023

Qian Qin

This research explores the intricate dynamics of national interests realised through Japan's official development assistance (ODA) to China. It aims to deepen the understanding of…

Abstract

Purpose

This research explores the intricate dynamics of national interests realised through Japan's official development assistance (ODA) to China. It aims to deepen the understanding of these mechanisms, detailing the extent to which Japan has accomplished its national interests.

Design/methodology/approach

The paper applies the role theory and narrative analysis to elucidate Japan's national role conception and its categories of national interests with regards to its ODA policy. It utilises both qualitative and quantitative methods to examine the success rate in achieving Japan's diplomatic objectives and how those interests have manifested over time.

Findings

The findings suggest a mixed outcome. Whilst Japan's ODA to China has helped in expanding trade and fostering mutual understanding and cooperation, it has been less successful in promoting democratic governance in China or effectively counterbalancing China's regional power. Hence, the realisation of national interests through ODA is a complex process contingent upon numerous factors.

Originality/value

This study stands out for its multifaceted approach in examining Japan's ODA policy towards China, integrating both quantitative and qualitative methodologies and applying the role theory in the context of international development aid. It fills a significant gap in the literature by analysing the interplay between national interests and foreign aid, providing nuanced insights into the successes and challenges of Japan's pursuit of its diplomatic objectives. The study's findings have important implications for understanding the complexity of international aid dynamics and can inform future policy decisions in the realm of international relations and foreign aid.

Details

International Trade, Politics and Development, vol. 8 no. 1
Type: Research Article
ISSN: 2586-3932

Keywords

Article
Publication date: 28 November 2023

Yan Han, Rodney B.W. Smith and Laping Wu

This paper aims to examine the impact of six possible foreign direct investment (FDI) spillover channels on the total factor productivity (TFP) of Chinese agricultural enterprises…

Abstract

Purpose

This paper aims to examine the impact of six possible foreign direct investment (FDI) spillover channels on the total factor productivity (TFP) of Chinese agricultural enterprises and investigate the moderating role of absorptive capacity (technological acumen) on TFP spillover effects.

Design/methodology/approach

Based on data from 118 agricultural and related Chinese industries, the authors employ a multithreshold regression model to empirically analyze the impact of FDI on the TFP of agricultural enterprises and the threshold effect of absorptive capacity. To overcome potential endogeneity problems, the authors select the FDI stock of corresponding USA industries and the industrial access policy index as instrumental variables and re-estimate the model.

Findings

The results suggest foreign-invested agricultural enterprises are more likely to benefit from FDI, while the “aggregate” FDI spillover effect is negative for domestic agricultural enterprises. However, once threshold effects are introduced, the authors find firms “close to” (“far from”) the technological frontier experience statistically significant positive (negative) spillover effects. Similar results are obtained for virtually all FDI spillover channels for firms in both upstream and downstream industries. FDI spillovers, when they occur, can be a two-edged sword – benefiting some firms at the expense of others.

Originality/value

The authors introduce six FDI spillover channels to examine the impact of FDI on the productivity of foreign-invested and domestic agricultural enterprises. Moreover, the authors analyze the threshold effect of firms' absorptive capacity. These findings can help formulate foreign investment introduction policies based on the characteristics of agricultural enterprises with different ownership structures. These results are also beneficial for agricultural enterprises to better exploit FDI spillover effects and improve their productivity.

Details

China Agricultural Economic Review, vol. 16 no. 1
Type: Research Article
ISSN: 1756-137X

Keywords

Article
Publication date: 23 December 2022

Mohamad Zreik

The regional comprehensive economic partnership (RCEP) is promising as per the claims and can be revolutionary for the Asia–Pacific Region. The member countries will get a boost…

Abstract

Purpose

The regional comprehensive economic partnership (RCEP) is promising as per the claims and can be revolutionary for the Asia–Pacific Region. The member countries will get a boost in the post-pandemic world due to the RCEP. According to Brookings, the RCEP is going to be an agreement reshaping the global economics. This study aims to clarify the aspects related to the RCEP and how it can boost global economics.

Design/methodology/approach

The study employs qualitative descriptive analysis to address the status of RCEP in the region and the consequences of such main transnational partnership. The study is based on economic reports, official documents and data directly related to the subject of the study.

Findings

Findings show that the RCEP will be a significant driver of regional trade despite its faults. The RCEP's tariff benefits and rules of origin, notwithstanding their relatively restricted scope, will encourage enterprises to source products and services from RCEP members, and in combination, RCEP and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) are anticipated to replace at least some competing US commodities, services and farm exports. For items that integrate parts and components from inside the area, such as from China, the RCEP is projected to reduce tax and trade facilitation costs, allowing enterprises to avoid US Section 301 tariffs.

Originality/value

By examining how the RCEP operates within the framework of domestic and international trade, this study contributes to a deeper understanding of RCEP and analyses its nature based on data and official reports.

Details

Journal of Economic and Administrative Sciences, vol. 40 no. 1
Type: Research Article
ISSN: 1026-4116

Keywords

Article
Publication date: 29 November 2021

Najimu Saka, Abdullahi Babatunde Saka, Opeoluwa Akinradewo and Clinton O. Aigbavboa

The complex interaction of politics and the economy is a critical factor for the sustainable growth and development of the construction sector (CNS). This study aims to…

Abstract

Purpose

The complex interaction of politics and the economy is a critical factor for the sustainable growth and development of the construction sector (CNS). This study aims to investigate the effects of type of political administration including democracy and military on the performance of CNS using the Nigerian Construction Sector (NCS) as a case study.

Design/methodology/approach

A 48 year (1970–2017) time series data (TSD) on the NCS and the gross domestic product (GDP) based on 2010 constant USD were extracted from the United Nations Statistical Department database. Analysis of variance (ANOVA) and analysis of covariance (ANCOVA) models were used to analyze the TSD. The ANCOVA model includes the GDP as correlational variable or covariate.

Findings

The estimates of the ANOVA model indicate that democratic administration is significantly better than military administration in construction performance. However, the ANCOVA model indicates that the GDP is more important than political administration in the performance of the CNS. The study recommends for a new national construction policy, favourable fiscal and monetary policy, local content development policy and construction credit guaranty scheme for the rapid growth and development of the NCS.

Originality/value

Hitherto, little is known about the influence of political administration on the performance of the CNS. This study provides empirical evidence from a developing economy perspective. It presents the relationships and highlights recommendations for driving growth in the construction industry.

Article
Publication date: 10 January 2024

Li Dai and Yongsun Paik

Conventional wisdom suggests that war in the host country makes it unattractive for foreign firms to invest. To see if this is true for US firms on the aggregate, this paper aims…

Abstract

Purpose

Conventional wisdom suggests that war in the host country makes it unattractive for foreign firms to invest. To see if this is true for US firms on the aggregate, this paper aims to examine the veracity of a “permanent war economy” hypothesis, that foreign direct investment (FDI) may, in fact, increase in the host country not despite, but because of, war, i.e. one that lends credence to the idea that, in the USA, “defense [has] become one of constant preparation for future wars and foreign interventions rather than an exercise in response to one-off threats.”

Design/methodology/approach

The authors test the hypotheses using Generalized Method of Moments estimation, with Heckman Selection, on US FDI data from the Bureau of Economic Analysis and war data from the Correlates of War2 Project, the Uppsala Conflict Data Program/International Peace Research Institute data set, the International Crisis Behavior Project and the Center for Systemic Peace Major Episodes of Political Violence data set. The final sample consists of 351 country-year observations in 55 host countries from 1982 to 2006.

Findings

The findings indicate that overall US FDI in a host country in a given year decreases if the host country is engaged in wars with multiple countries and if the US Government is involved in the war. Most notably, the results show that US involvement in multiple host country wars is actually correlated with increased US FDI into the host country, providing empirical support for the “permanent war economy” hypothesis.

Originality/value

While other studies have focused on war and FDI, the authors have sought to show the impact of the involvement of arguably the most influential country, i.e. the USA, in the sovereign matters of a focal host country. By studying FDI from the USA as a function of US involvement in wars overseas, over the years with the greatest use of private military companies by the USA and the largest portion of global FDI accounted for by the USA, this work motivates a research agenda on home-host-"other” relations in the context of war and FDI, with the “other” being the supranational “elephant in the room.”

Details

Multinational Business Review, vol. 32 no. 1
Type: Research Article
ISSN: 1525-383X

Keywords

Open Access
Article
Publication date: 20 November 2023

Devesh Singh

This study aims to examine foreign direct investment (FDI) factors and develops a rational framework for FDI inflow in Western European countries such as France, Germany, the…

Abstract

Purpose

This study aims to examine foreign direct investment (FDI) factors and develops a rational framework for FDI inflow in Western European countries such as France, Germany, the Netherlands, Switzerland, Belgium and Austria.

Design/methodology/approach

Data for this study were collected from the World development indicators (WDI) database from 1995 to 2018. Factors such as economic growth, pollution, trade, domestic capital investment, gross value-added and the financial stability of the country that influence FDI decisions were selected through empirical literature. A framework was developed using interpretable machine learning (IML), decision trees and three-stage least squares simultaneous equation methods for FDI inflow in Western Europe.

Findings

The findings of this study show that there is a difference between the most important and trusted factors for FDI inflow. Additionally, this study shows that machine learning (ML) models can perform better than conventional linear regression models.

Research limitations/implications

This research has several limitations. Ideally, classification accuracies should be higher, and the current scope of this research is limited to examining the performance of FDI determinants within Western Europe.

Practical implications

Through this framework, the national government can understand how investors make their capital allocation decisions in their country. The framework developed in this study can help policymakers better understand the rationality of FDI inflows.

Originality/value

An IML framework has not been developed in prior studies to analyze FDI inflows. Additionally, the author demonstrates the applicability of the IML framework for estimating FDI inflows in Western Europe.

Details

Journal of Economics, Finance and Administrative Science, vol. 29 no. 57
Type: Research Article
ISSN: 2077-1886

Keywords

Article
Publication date: 11 November 2022

Özcan Karahan and Olcay Çolak

The direction of the causality relationship between Foreign Direct Investment (FDI) and economic growth is a highly controversial issue in the literature. There are two basic…

Abstract

Purpose

The direction of the causality relationship between Foreign Direct Investment (FDI) and economic growth is a highly controversial issue in the literature. There are two basic approaches advocating different causal directions between FDI and growth, which are called hypotheses of FDI-led Growth and Growth-led FDI. The aim of this study is to analyze the causality relationship between FDI and economic growth in RCEP countries and thus make a new contribution to the discussions in the relevant literature. In addition, the results of the study are expected to provide important implications for the policies to be designed for economic growth based on FDI flows to RCEP countries. Thus, by examining the direction of causality between FDI and economic growth in RCEP countries, we aim to provide a new contribution to related literature and make some implications for the policy design process of economic growth in the RCEP area.

Design/methodology/approach

We empirically examined the direction of a causal link between FDI and economic growth in the context of Regional Comprehensive Economic Partnership (RPEC) countries in order to test the hypothesis of FDI-led growth and Growth-led FDI. Accordingly, as our main variables of interest, we incorporated the inward foreign direct investment stock to gross domestic product ratio (FDI) and gross domestic product per capita (GDP). Hatemi-J (2012) asymmetric causality test has been employed in the investigation of the direction of causality between FDI and GDP over the period of 1980–2020. Thus, unlike most of the studies investigating the direction of causality between FDI and growth using the linear causality analysis method, our study performed a nonlinear causality analysis.

Findings

Empirical results reveal that the causal relationship between FDI and national income in RPEC countries is non-linear or asymmetric . The results of the symmetric causality test for both from FDI to national income and from national income to FDI are statistically insignificant for all countries. Therefore, this finding obtained from the study provided an important guide to the econometric methods to be used in other studies to be conducted in the same region in the future. Concerning the asymmetric causality relationship from FDI to growth, positive FDI shocks are an important cause of national income in most RCEP countries. However, the effect of negative FDI shocks on national income is quite weak compared to positive shocks. Regarding the asymmetric causality relationship from growth to FDI, positive national income shocks do not create a significant causal relationship with FDI. Similarly, the effects of negative national income shocks on FDI are statistically insignificant. Overall, asymmetric causality test results reveal that positive FDI shocks have an important causal impact on economic growth in most RCEP countries. Thus, the results of econometric analysis mostly support the argument that the FDI-led growth hypothesis rather than the Growth-led FDI hypothesis in RCEP countries. Accordingly, policy-makers in most of the RCEP countries should continue to provide more incentives and facilities to multinational companies in order to ensure constant economic growth.

Originality/value

Our study brings a significant difference in the econometric method used compared to most of the other studies in the literature. Existing empirical studies on the direction of causality between FDI and growth mostly use standard Granger-linear causality-type tests to detect the direction of causality among FDI and growth. Unlike most of the studies in the literature, our study adopted a different methodological approach, namely the Hatemi J test to detect the non-linear causality between FDI and economic growth in RCEP countries. Therefore, this paper made a new methodological contribution significantly to the literature focusing on the causal relationship between FDI and economic growth by using a non-linear causality method rather than a linear causality one.

Details

Journal of Economic and Administrative Sciences, vol. 40 no. 1
Type: Research Article
ISSN: 1026-4116

Keywords

Article
Publication date: 22 March 2024

Imran Khan and Darshita Fulara Gunwant

The purpose of this paper is to empirically analyze the impact of social inclusion factors and foreign fund inflows on reducing gender-based unemployment in India.

Abstract

Purpose

The purpose of this paper is to empirically analyze the impact of social inclusion factors and foreign fund inflows on reducing gender-based unemployment in India.

Design/methodology/approach

A time series data set for the period of 1991–2021 has been considered, and an autoregressive distributed lag methodology has been applied to measure the short- and long-run impact of social inclusion and foreign fund inflows on reducing gender-based unemployment in India.

Findings

According to the study’s findings, both social inclusion and foreign fund inflows are critical factors for reducing male unemployment. However, in the case of female unemployment, only social inclusion factors play an important role, whereas foreign fund inflows have no role in it.

Originality/value

Analyzing the factors that affect gender-based unemployment has always been a grey area in literature. There are very few studies that capture gender-based unemployment in India, making this study a novice contribution. Second, it examines the relationship between foreign fund inflows, social inclusion and unemployment, which is another novel area of investigation. Finally, this study provides comprehensive and distinct results for both male and female unemployment that can help policymakers devise gender-based unemployment policies.

Details

Indian Growth and Development Review, vol. 17 no. 1
Type: Research Article
ISSN: 1753-8254

Keywords

Article
Publication date: 8 September 2022

Nisha Prakash and Madhvi Sethi

This article investigates the impact of foreign trade on carbon emissions of the member countries of the largest trade bloc, the Regional Comprehensive Economic Partnership (RCEP).

Abstract

Purpose

This article investigates the impact of foreign trade on carbon emissions of the member countries of the largest trade bloc, the Regional Comprehensive Economic Partnership (RCEP).

Design/methodology/approach

The aggregate bilateral trade with members of RCEP during the period 1991–2020 was considered for analysis. The study also examines the impact of foreign trade (between member countries) on economic development, represented by GDP per capita. Dumitrescu–Hurlin panel Granger causality test was conducted to understand the impact of foreign trade on GDP per capita and carbon emissions.

Findings

Results indicate that though foreign trade is heterogeneously Granger causing GDP per capita, it also aggravates carbon emissions in RCEP bloc.

Originality/value

The study is of significance to the policymakers in the member countries as it provides evidence to include climate impact in trade agreements. The wealthier RCEP member countries can support the green transition of low-income countries through transfer of eco-friendly technologies.

Details

Journal of Economic and Administrative Sciences, vol. 40 no. 1
Type: Research Article
ISSN: 1026-4116

Keywords

Article
Publication date: 19 October 2023

Lin Fu, Rui Long, Xiaohua Sun and Yun Wang

The purpose of this study is to analyze the effect of foreign direct investment (FDI) on pollution emissions and how environmental regulation affects this relationship.

Abstract

Purpose

The purpose of this study is to analyze the effect of foreign direct investment (FDI) on pollution emissions and how environmental regulation affects this relationship.

Design/methodology/approach

In the empirical research, the authors selected panel data for 30 provinces in China from 2005 to 2019 as samples. First, the authors used the instrumental variable method to verify the existence of the above hypotheses in China. Then, the authors analyzed the moderating effect of different types of environmental regulations on the environmental effects of FDI. Next, in further discussion, the authors analyzed the difference between the environmental effect and the moderating effect in different time periods and regions, respectively. Finally, the authors discussed whether the different intensities of environmental regulations lead to the transfer effect of FDI in choosing investment destinations.

Findings

The result shows that FDI can help reduce pollution emissions and create a “pollution halo” effect, which is enhanced by command-and-control regulation but suppressed by market-based incentives. The heterogeneity analysis reveals that the 18th National Congress of the Communist Party has weakened the pollution halo effect of FDI, while the environmental effect of FDI in the eastern region is not significant, but in the middle and western regions, there is a significant pollution halo effect and a positive moderating effect of environmental regulations. Finally, further analysis reveals that FDI has a transfer effect under command-and-control environmental regulations.

Research limitations/implications

First, the main purpose of this paper is to study the relationship between FDI and pollution emissions from the perspective of heterogeneous environmental regulation. Therefore, there is no detailed discussion on their effect mechanism of them. Second, limited by data, the authors adopt the single index to measure the stringency index of command-and-control and market-based incentive environmental regulations in China. The single index may not be able to fully reflect the intensity of regional environmental regulation, so the construction of a composite indicator is necessary. These shortcomings are the focus of the authors' future research.

Practical implications

Under the guidance of high-quality development, the conclusions above can provide reference for adjusting FDI policies and improving environmental regulation policies.

Originality/value

The innovations in this paper can be summarized as the following four dimensions: First, the authors use the instrumental variable (IV) method to address endogeneity in the relationship between FDI and pollution emission, which can further ensure the robustness of the research results and increases the credibility of the paper. Second, the authors distinguish between two types of environmental regulations to investigate their moderating effect on the environmental impact of FDI. Third, the authors consider the temporal and spatial heterogeneity of both the environmental effects of FDI and the moderating effect of regulation. Last, the authors analyze the spatial spillover of environmental regulation through the study of the transfer effect.

Details

Management of Environmental Quality: An International Journal, vol. 35 no. 2
Type: Research Article
ISSN: 1477-7835

Keywords

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