 Productivity and the Timing of Foreign Direct Investment (in Korean)Sangho Kim ()
Economic Analysis (Quarterly), 2010, vol. 16, issue 1, 106-126 Abstract: This study investigates the value of waiting that exists in the firm's decision-making on foreign direct investment (FDI) in the context of firm's productivity by applying a Cox(1972) proportional hazards model to Korean manufacturing firms' FDI data in China. The paper hypothesizes that firms with intermediate productivity level tend to realize their first investments earlier than the manufacturing firms with relatively high and low productivity levels. Empirical results show that the timing of FDI is a positive quadratic function of firm's productivity, suggesting that average productive firms lead FDI, followed by both more productive firms that delay their FDI to lower the probability of FDI failure and by less productive firms that don't have enough resources required to implement the investment. These results hold in two industries out of four industries in industry-wise regression. Keywords: FDI; Value of waiting; Cox hazards model (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bok:journl:v:16:y:2010:i:1:p:106-126 Access Statistics for this article Economic Analysis (Quarterly) is currently edited by Wook Sohn, Hwan-koo Kang and Jaerang Lee More articles in Economic Analysis (Quarterly) from Economic Research Institute, Bank of Korea Contact information at EDIRC. |
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