Exchange Rates and Outward Foreign Direct Investment: US FDI in Emerging Economies

Manop Udomkerdmongkol, Oliver Morrissey and Holger Görg

No RP2008-102, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: The paper investigates the impact of exchange rates on US foreign direct investment (FDI) flows to a sample of 16 emerging market countries using annual panel data for the period 1990-2002. Three separate exchange rate effects are considered: the value of the local currency (a cheaper currency attracts FDI); expected changes in the exchange rate (expected devaluation implies FDI is postponed); and exchange rate volatility (discourages FDI).

Keywords: Foreign exchange; Foreign investments; Panel analysis (search for similar items in EconPapers)
Date: 2008
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Journal Article: Exchange Rates and Outward Foreign Direct Investment: US FDI in Emerging Economies (2009)
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