The Impact of the Belt and Road Initiative on Foreign Direct Investment from China, the United States, and Major Investor Countries
Yasuyuki Todo,
Shuhei Nishitateno and
Sean Brown
Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)
Abstract:
This paper investigates the impact of the Belt and Road Initiative (BRI) on foreign direct investment (FDI) from China and other major source countries, such as the United States (US), France and Japan, by applying staggered difference-in-differences (DID) event study estimations to a gravity model. In addition to estimations using country-pair fixed effects, we employ models with source and host country-year fixed effects to control for effects through changes in any host country attribute due to the BRI, such as infrastructural changes. By so doing, we separately estimate the BRI effect as changes occur in bilateral relationships. We find that FDI from China, Hong Kong, the US, Switzerland, Japan, and France to BRI countries increased in the post-BRI period, whereas FDI from the UK, the Netherlands, and Luxembourg decreased. After controlling for country-year fixed effects, there remains a post-BRI upward trend in FDI from the US, Switzerland, and France and a downward trend in FDI from the UK, the Netherlands, and Luxembourg. These findings suggest that FDI from non-China countries to BRI countries are affected by individual bilateral relationships between the non-China countries and the BRI recipient countries. For example, the US may invest more in BRI countries to strategically compete with China in those locations.
Pages: 37 pages
Date: 2025-01
New Economics Papers: this item is included in nep-cna, nep-fdg and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://www.rieti.go.jp/jp/publications/dp/25e004.pdf (application/pdf)
Related works:
Working Paper: The Impact of the Belt and Road Initiative on Foreign Direct Investment from China, the United States, and Major Investor Countries (2025) 
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:eti:dpaper:25004
Access Statistics for this paper
More papers in Discussion papers from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().