Looking beyond the curtain: pass-through capital and round-tripping in Italy's foreign direct investment

Nadia Accoto () and Giacomo Oddo
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Nadia Accoto: Bank of Italy

No 762, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: The growing complexity of the financing and ownership structures of multinational enterprises (MNEs) leads to control chains that extend across a number of countries and obscure the ultimate sources and destinations of foreign direct investment (FDI). This results in what is known in the literature as ‘pass-through capital' (i.e. capital entering and exiting from a given country) and 'round-tripping' (i.e. capital leaving the investor's jurisdiction at the top of the investment chain and then returning to the same country). This study quantifies and analyses pass-through capital and round-tripping for Italy along their geographical and sectoral dimensions, applying a simple methodology based on information on the residency of the ultimate investor as reported in the surveys of firms conducted for the purpose of compiling the balance of payments in the years 2013-2020.

Keywords: foreign direct investment; pass-through capital; multinational enterprises; external statistics (search for similar items in EconPapers)
JEL-codes: F21 F23 (search for similar items in EconPapers)
Date: 2023-04
New Economics Papers: this item is included in nep-int
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