VLIV PŘÍMÝCH ZAHRANIČNÍCH INVESTIC NA DODAVATELSKÉ VZTAHY A POSTAVENÍ DOMÁCÍCH VÝROBCŮ MEZIPRODUKTŮ

FDI's Impact on Inter-industry Interactions among Domestic Suppliers of Intermediate Goods

Jan Hanousek, Evžen Kočenda and Pavla Vozárová

Politická ekonomie, 2017, vol. 2017, issue 4, 391-409

Abstract: In this paper, we analyze the extent of the impact of FDI on the host economy according to theoretical predictions. Within a broader context of international trade flows, we focus on inter-industry interactions between a multinational enterprise (MNE) that enters the domestic market and other firms in the economy. We seek to determine if the MNE uses domestic suppliers of intermediate goods or if it purchases its supplies from abroad or from other MNEs entering the downstream sector. Our analysis covers both Western and Eastern European countries over the period 2001-2007. Our results show that FDI increases the demand for intermediary goods. However, domestic producers of these goods can benefit only partially from this positive shock, since they are at the same time crowded-out by MNEs entering the upstream sector as well as by importers.

Keywords: FDI; international trade; multinational enterprise; downstream sector; inter-industry interactions; Europe (search for similar items in EconPapers)
JEL-codes: C23 F14 F21 F23 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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DOI: 10.18267/j.polek.1151

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