FDI spillovers and time since foreign entry

Bruno Merlevede (), Koen Schoors and Mariana Spatareanu

No 27/2013, BOFIT Discussion Papers from Bank of Finland, Institute for Economies in Transition

Abstract: This study measures the effect of foreign direct investment (FDI) on the productivity of local firms. Unlike earlier studies, our empirical approach does not require that FDI manifests immediate or permanent effects. We find that foreign entry initially affects productivity of local competitors negatively, but is more than offset by a permanent positive effect on local competitors once majority-foreign-owned firms have been present for a while. The effect on the productivity of local suppliers, in contrast, is transient. The entry of majority-foreign-owned firms boosts productivity of local suppliers after a short adaption period, but then fades. The positive impact of minority-foreign-owned firms on local suppliers is immediate, but smaller and transient. Keywords: FDI, spillovers, dynamics, timing JEL Classification: F2

Date: 2013-11-19
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed

Published in Published in World Development, Volume 56, April 2014, Pages 1-19.

Downloads: (external link)
https://helda.helsinki.fi/bof/bitstream/123456789/8045/1/172743.pdf (application/pdf)

Related works:
Journal Article: FDI Spillovers and Time since Foreign Entry (2014)
Working Paper: FDI Spillovers and the Time since Foreign Entry (2011)
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:bof:bofitp:2013_027

Access Statistics for this paper

More papers in BOFIT Discussion Papers from Bank of Finland, Institute for Economies in Transition Bank of Finland, BOFIT, P.O. Box 160, FI-00101 Helsinki, Finland. Contact information at EDIRC.
Bibliographic data for series maintained by Minna Nyman ().