The Effect of the Euro on Foreign Direct Investment

Pavlos Petroulas

No 2004:5, Research Papers in Economics from Stockholm University, Department of Economics

Abstract: In this paper the recent effect of the European Monetary Union on inward FDI-flows is examined. We use a difference-in-differences approach and fixed effects with common time controls. The estimated results of the latter approach show that the introduction of the Euro raises inward FDI by 17 percent within the Euro-area and by 9 and 12 percent to and from non-member countries respectively. Moreover the geographical effects of the Euro are explored. The results show partial agglomeration tendencies for the euro area. There are also some indications of increased importance of vertical specialization in the sample.

Keywords: Foreign Direct Investment; EMU; Panel Data (search for similar items in EconPapers)
JEL-codes: C23 F02 F21 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2004-05-24
New Economics Papers: this item is included in nep-eec and nep-ifn
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Forthcoming in European Economic Review.

Downloads: (external link)
http://www2.ne.su.se/paper/wp04_05.pdf (application/pdf)

Related works:
Journal Article: The effect of the euro on foreign direct investment (2007)
Working Paper: The Effect of the Euro on Foreign Direct Investment (2006)
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:hhs:sunrpe:2004_0005

Access Statistics for this paper

More papers in Research Papers in Economics from Stockholm University, Department of Economics Department of Economics, Stockholm, S-106 91 Stockholm, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Anne Jensen ( this e-mail address is bad, please contact ).