Measuring multinational production with foreign direct investment statistics: A survey of challenges and recent developments

Konstantin M. Wacker, Bruno Casella and Maria Borga

Journal of Economic Surveys, 2025, vol. 39, issue 4, 1462-1487

Abstract: Foreign direct investment (FDI) statistics are frequently used to proxy multinational production and activities of multinational enterprises (MNEs). Yet, FDI statistics have been subject to critique because FDI is also driven by financial motives that are barely related to real production activities. In this paper, we survey recent advancements in the compilation of international FDI statistics that address those challenges. We discuss how those improved FDI statistics help to tighten the relation between FDI data and multinational production and provide guidance to applied researchers how to implement this in practice.

Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jecsur:v:39:y:2025:i:4:p:1462-1487

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