The Concentric-Circle Model of FDI Spillover Effects: Estimation Using Hungarian Panel Data

Ichiro Iwasaki, 一郎 岩﨑, イチロウ イワサキ, Péter Csizmadia, Miklós Illéssy, Csaba Makó and Miklós Szanyi

No a521, Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: A new empirical model is presented in this paper with respect to the productivity spillover effects of foreign direct investment (FDI) by focusing on the concentric-circle structure of industrial organizations arising from sectoral differences among firms. In this model, the market presence of horizontal FDI in a host country is expressed using multiple variables with a nested structure corresponding to the aggregated level of industrial classification in order to identify its spillover effects on the productivity of domestic firms according to the industrial sector with different depth. We estimated the model using large-scale firm-level data from Hungary and confirmed horizontal FDI spillover effects simultaneously taking place in sectors with different depth that cannot be captured with the conventional model having a single horizontal variable.

Keywords: foreign direct investment; spillover effects; concentric-circle model; Hungary (search for similar items in EconPapers)
JEL-codes: D24 F21 F23 L16 L60 L80 O19 P23 (search for similar items in EconPapers)
Date: 2009-11
New Economics Papers: this item is included in nep-int, nep-sbm and nep-tra
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Related works:
Working Paper: The concentric-circle model of FDI spilklover effects estimation using Hungarian panel data (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hit:hituec:a521

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