The impact of FDI on industry performance

Jürgen Bitzer () and Holger Görg ()

International Trade from EconWPA

Abstract: This paper investigates the productivity effects of inward and outward foreign direct investment using industry and country level data for 17 OECD countries. The paper relates to a large recent literature on productivity spillovers from inward FDI, however, we also consider the relationship between productivity and outward FDI in the same estimation. Our results show that there are, on average, productivity benefits from inward FDI, although we can identify a number of countries which, on aggregate, do not appear to benefit in terms of productivity. On the other hand, a country's stock of outward FDI is, on average, negatively related to productivity. However, again there is substantial heterogeneity in the effect across OECD countries.

Keywords: Foreign direct investment; inward FDI; outward FDI; productivity; spillovers (search for similar items in EconPapers)
JEL-codes: F23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-int
Date: 2005-05-04
Note: Type of Document - pdf; pages: 27
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