Financial Competitiveness, Financial Openness and Bilateral Foreign Direct Investment

Na Tan, Wei Wang, Jiaohui Yang and Liang Chang

Emerging Markets Finance and Trade, 2019, vol. 55, issue 14, 3349-3369

Abstract: In this article, we test the impacts of financial competitiveness and financial openness on bilateral FDI with novel indexes, covering 127 host countries and 122 home countries from 2009 to 2016. We find that the improvement of financial competitiveness and financial openness significantly increases the FDI assets in the home country and significantly increases the FDI liabilities in the host country. In particular, the impacts of financial competitiveness and financial openness are significant both on the intensive and extensive margins. In addition, the above results remain robust in further analyses, such as using sub-index of financial competitiveness, using quantile regression model, considering capital control on FDI and dealing with the endogenous problem. The study demonstrates the financial competitiveness and financial openness are important factors to explain why FDI positions are relatively small in some developing countries.

Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://hdl.handle.net/10.1080/1540496X.2019.1590194 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mes:emfitr:v:55:y:2019:i:14:p:3349-3369

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/MREE20

DOI: 10.1080/1540496X.2019.1590194

Access Statistics for this article

More articles in Emerging Markets Finance and Trade from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().