A non-monotonic Relationship between FDI and Trade

José Pontes

No 05/06, Dresden Discussion Paper Series in Economics from Technische Universität Dresden, Faculty of Business and Economics, Department of Economics

Abstract: This paper presents a non-monotonic relationship between foreign direct investment and trade based on the idea that, although FDI eliminates trade costs on the final good, the investing firm has to bear increased trade costs on an intermediate good.

Keywords: Foreign Direct Investment; Trade; Theory of Location (search for similar items in EconPapers)
JEL-codes: F23 L12 R3 (search for similar items in EconPapers)
Date: 2006
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https://www.econstor.eu/bitstream/10419/22732/1/DDPE200605.pdf (application/pdf)

Related works:
Journal Article: A non-monotonic relationship between FDI and trade (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:tuddps:0506

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