The impact of double taxation treaties on foreign direct investment: evidence from large dyadic panel data

Fabian Barthel, Matthias Busse and Eric Neumayer

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: To increase inward foreign direct investment (FDI), policy makers increasingly resort to the ratification of double taxation treaties (DTTs). However, the effectiveness of DTTs in inducing higher FDI is still open to debate, as the empirical evidence of existing studies is anything but conclusive. In contrast to earlier approaches, we use a largely unpublished dataset on bilateral FDI stocks, covering a much larger and more representative sample of host and source countries. Controlling for standard determinants of FDI and employing various econometric specifications, our results indicate that DTTs do lead to higher FDI stocks and that the effects are substantively important as well.

Keywords: ISI (search for similar items in EconPapers)
JEL-codes: F3 G3 (search for similar items in EconPapers)
Date: 2010-07
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Citations: View citations in EconPapers (33)

Published in Contemporary Economic Policy, July, 2010, 28(3), pp. 366-377. ISSN: 1074-3529

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Related works:
Journal Article: THE IMPACT OF DOUBLE TAXATION TREATIES ON FOREIGN DIRECT INVESTMENT: EVIDENCE FROM LARGE DYADIC PANEL DATA (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:28823

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