Productivity Growth Effects of FDI Spillovers: Evidence from the Türkiye Manufacturing Industries

Shahid Mahmood Waqar and Musa Abdu
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Shahid Mahmood Waqar: Department of Economics, Nangarhar University, Daronta, Nangarhar, Afghanistan†Department of Economics, Gombe State University, Tudun Wada Gombe, Gombe, Nigeria
Musa Abdu: ��Department of Economics, Gombe State University, Tudun Wada Gombe, Gombe, Nigeria‡Department of Economics, Ankara Yıldırım Beyazıt University, Dumlupınar Mahallesi, 06760, Esenboğa Yerleşkesi C Blok 2. Kat - Çubuk, Ankara, Türkiye

Journal of International Commerce, Economics and Policy (JICEP), 2023, vol. 14, issue 03, 1-24

Abstract: This study explores the productivity growth effects of horizontal, backward, and forward FDI spillovers in the Türkiye manufacturing sector using industry-level data for the period 2008–2018. While controlling for capital intensity and human capital as proxies for the absorption capacity, we apply system GMM and bootstrapped LSDV estimator to estimate the models. Our findings reveal that backward linkages significantly hamper industrial productivity due to the rudimentary nature of the products in the downstream sector or lack of absorption capacity. While horizontal spillovers retard the productivity growth; forward linkages enhance the growth, though all insignificant. The results depict that all the interactions with capital intensity strongly promote industrial productivity growth.

Keywords: Industrial productivity; FDI spillovers; GMM; absorption capacity (search for similar items in EconPapers)
JEL-codes: D24 D25 F23 F62 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1142/S1793993323500199

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