Spillovers from foreign direct investment in services: Evidence at sub-sectoral level for the Asia-Pacific

We take a sectoral level approach to analyzing the effects of foreign direct investment (FDI) inflows. We disaggregate FDI first by manufacturing versus services, then within services by financial services, trade services, and business services. We consider the effects of FDI inflows on growth of GDP per capita, then distinguish between growth in manufacturing and services value added per capita. Our data sample comprises 14 Asia Pacific economies for the period 1985–2012 to which we apply a dynamic panel generalized method of moments estimation technique. Services FDI as a whole is found to have a significantly positive impact on GDP growth while manufacturing FDI is found to have no effect. The impetus for growth from services FDI traces to financial services in particular, acting not only directly on service sector output but through manufacturing sector output as well. By contrast, trade services FDI is found to have a significantly negative effect on manufacturing output with no significant effect on services output. Foreign participation in trade services may act to expose domestic manufacturers to international competition and may also lead to domestic consolidation to take advantage of economies of scale.     

Understanding the role of trade agreements in Indonesia’s FDI

In this paper, we develop the hypothesis that trade agreements influence foreign direct investment (FDI). We extend the conventional model of FDI determinants to accommodate the role of trade agreements. Fitting Indonesian data to this model, we discover strong evidence that, while both bilateral and multilateral trade agreements positively influence Indonesia’s FDI, multilateral agreements have a larger effect. We further distinguish FDI by sector and find sector-specific trade agreements play an active role: these agreements positively influence FDI in the primary and service sectors, but not in the manufacturing sector. We also find that trade agreements positively influence FDI through the export and total factor productivity channels, and less so through the economic growth channel.     

Sectoral FDI cycles in South and East Asia

This study aims to analyze how sectoral foreign direct investment (FDI) inflows in South and East Asian economies respond to changes in the business cycles of the host countries, as measured by their output gaps. We focus on 15 economies during the period 1980–2011 and examine inflows of FDI in extractive industries, manufacturing and services in addition to aggregate FDI by using a dynamic panel Blundell–Bond GMM methodology. We find evidence of countercyclical behavior of services FDI and acyclical behavior of both extractive industries FDI and manufacturing FDI. The coutercyclical behavior of services FDI in South and East Asia has important policy implications.     

Short-run and long-run effects of exchange rate change on trade balance: Evidence from China and its trading partners

As one of largest exporting countries in the world, China has experienced a large amount of trade surpluses for the past decade. However, a growing criticism has been focused on the manipulation of Chinese Yuan (RMB) exchange rate by the Chinese government. While China implemented the exchange rate reform policy in July 2005, the question, whether its currency is undervalued remains as a debatable issue. Different from previous studies by focusing on individual trading partners, this paper tests the short-run J-Curve hypothesis and long-run trade balance effect of real exchange rate between China and its eighteen major trading partners using a panel dataset over the 2005–2009 period. We adopt the methodologies of panel cointegration test, fully modified OLS for heterogeneous cointegrated panel (panel FMOLS) and panel error correction model (panel ECM) to investigate the above examination. Our empirical results lend support to the inverted J-curve hypothesis between China and its trading partners. However, we find that a real appreciation of RMB has a decreasing long-run effect on China's trade balance in only three of the eighteen trading partners, while it has an increasing long-run effect in five of the eighteen trading partners. These mixed findings, therefore, lead to the empirical evidence that the real appreciation of RMB has no overall long-run impact on China's trade balance.     

Estimating the export and import demand for manufactured goods: The role of FDI

In this paper we estimate the demand for exports and imports of manufactured goods for a panel containing the majority of the EU countries as well as the United States and Japan. The model includes as explanatory factors both the traditional determinants of trade and also the stock of foreign direct investment (FDI). We apply panel unit root and cointegration tests allowing for heterogeneity. Whereas there is no evidence of cointegration when using just the traditional formulation, the results are favorable to the existence of long-run relationships linking the variables of the augmented model. Moreover, the results point mainly to a complementary relationship between trade and FDI.     

Estimating the export and import demand for manufactured goods: The role of FDI

In this paper we estimate the demand for exports and imports of manufactured goods for a panel containing the majority of the EU countries as well as the United States and Japan. The model includes as explanatory factors both the traditional determinants of trade and also the stock of foreign direct investment (FDI). We apply panel unit root and cointegration tests allowing for heterogeneity. Whereas there is no evidence of cointegration when using just the traditional formulation, the results are favorable to the existence of long-run relationships linking the variables of the augmented model. Moreover, the results point mainly to a complementary relationship between trade and FDI.     

Do Institutions Matter for Foreign Direct Investment?

Using a panel of 69 countries during 1981 and 2005, we investigate the role of institutions in determining foreign direct investment (FDI). We find that institutions are a robust predictor of FDI and that the most significant institutional aspects are linked to propriety rights. Using a novel data set, we also study the impact of institutions on FDI at the sectoral level. We find that institutions do not have a significant impact on FDI in the primary sector but that institutional quality matters for FDI in manufacturing, and particularly in services.     

反向技术溢出、技术进步和我国经济增长——基于面板协整模型的分析

本文选取了1990～2007年间中国进口和对中国FDI前十位的国家和地区,扩展了CH模型,建立了包含进口和FDI两个物化型技术溢出指标的面板模型,利用面板单位根和协整技术,得到随机效应模型,分析溢出国对华出口和FDI对溢出国的反向技术溢出效应,结果表明:从溢出国角度看,对外投资比对外贸易更有利于这些国家和地区全要素生产率的提高,因此,溢出国更倾向于对华FDI,我国招商引资政策需要做出调整。     

Chinese exports and productivity gains: panel evidence

This paper examines the impact of imports from China on the labour productivity levels of importers, using unbalanced data from 1994 to 2006. It is hypothesised that imports from China increase importer countries' labour productivity levels. Using cross‐section, fixed and random‐effect models, a statistically significant, positive relationship is found between the share of a country's imports from China and labour productivity in the manufacturing sector of that country. Moreover, it is found that imports from China have a larger impact on China's main Asian‐Pacific trade partners and countries with higher manufacturing shares in their total exports.     

Macroeconomic and Sectoral Effects of International Trade: A Vector Error-Correction Study

This study examines various claims that in the U.S., international trade has contributed to a loss of manufacturing base, an increased gap between unskilled and skilled wages, lower employment, and a loss of productivity. Cointegration tests indicate that in the long run and at the macro level, the ratio of trade to output and FDI to output are correlated with the manufacturing share of output, the ratio of unskilled to skilled wages, labor productivity, and the employment rate. However, Granger causality tests reveal that, with one exception, causation does not run from trade to the domestic variables, the only exception being that FDI Granger causes productivity. When the focus is shifted to the manufacturing sector, the results support the proposition that openness to trade has had adverse effects on this sector.A slightly different version of this paper was presented at the Fifty-sixth International Atlantic Economic Conference, October 16–19, 2003 in Quebec City, Canada. The research reported in this paper is partially funded by a grant from the Institute for Global Economic Affairs at Marquette University.     

Productivity,Trade, and Institutional Quality: A Panel Analysis

Recognizing that gains historically attributed to trade capture instead the roles of institutions and geography, we estimate the relationship between labor productivity and trade for a panel of countries, 1980 to 2000. We use real and nominal openness as measures of trade. The endogeneity of trade and institutional quality is accounted for with instruments. Our trade instrument is based on a theoretically motivated gravity equation and uses a more comprehensive data set than in related studies. Fixed‐ and random‐effects and system‐GMM panel estimation methods address potential biases associated with cross‐section estimations. We find a robust relationship between real openness and labor productivity from the 1990s. Countries that trade more generate higher levels of productivity, supporting an institutional theory of growth. We find evidence that countries with low‐quality institutions benefit from openness to trade and that the positive effect of trade on labor productivity is lower for more populated countries.     

Foreign Direct Investment Inflows and Intellectual Property Rights: Empirical Evidence from Different Income Groups

This study examines the impact of intellectual property rights (IPRs) on Foreign direct investment (FDI) inflows by considering global data with three income groups classified by World Bank (i.e. high-, middle-, and low-income groups). The empirical model relates FDI inflows to IPRs, controlled by a set of known variables, namely GDP per capital, trade openness, real exchange rate, and real interest rate. The study covers panel data of between 35 and 100 countries for the period 1980–2014. The panel cointegration tests suggest that FDI inflow and IPRs with the other control variables are cointegrated for full countries and high-income group. Their estimated (long-run) coefficients are 0.04 and 0.18, respectively, but insignificant in the short-run. The impact (short-run) of TRIPS agreement is positive for full countries, but negative for low-income group. Non-causality tests further support the role of IPRs on FDI. Various transmission channels have been identified, in particularly for low-income countries. This study enlightens policymakers about the policy on creating a conducive and sustainable environment for IPRs in order to encourage FDI inflows to their countries.     

外商直接投资、进口贸易与全要素生产率——基于省域制造业的实证研究

本文以2000-2011年的省域制造业面板数据为基础,考察了外商直接投资和进口贸易对全要素生产率的影响。通过对全要素生产率的地区变化的横截面及不同时期的分解对比,本文的实证分析结果发现进口贸易和外商直接投资对全要素生产率的提高均具有正的促进作用,这表明,在不损害国家总体贸易政策的前提下加强进口和引进FDI是一种提高全要素生产率的较好方式。     

Outward Foreign Direct Investment and Domestic Performance: the Italian Manufacturing and Services Sectors

How does outward foreign direct investment (FDI) affect employment and productivity growth in the home country? Does the impact of outward investment differ among manufacturing and service sectors? In this paper we analyze the effects of investing abroad using firm-level data for Italy for the period 2003–2006. We adopt matching techniques in combination with a difference-in-difference estimator in order to investigate the causal effect of becoming multinational on domestic employment and productivity. Preliminary results suggest that Italian outward FDI has limited effects on domestic employment and performance of internationalizing firms on average. However, results significantly differ depending on the sector (manufacturing versus services) where the MNEs are operating. In particular, we find that while in the manufacturing sector, outward FDI tends to strengthen both productivity and, to less extent, employment. In the service sector, we find a negative effect on employment (two years after the investment).     

Firm Productivity and Mode of Foreign Expansion: Evidence from Taiwanese Manufacturing Firms

This paper builds on the recent literature on firm heterogeneity in international trade and foreign direct investment (FDI), and aims to empirically examine how firm productivity affects a firm’s foreign market entry strategy beyond the simple binary choice between exporting and FDI. Utilizing the panel data of Taiwanese manufacturing firms during 2002–2012, we further classify FDI methods by whole ownership or a joint venture to investigate a firm’s foreign expansion decision. By performing Kolmogorov–Smirnov (KS) tests, we find that if a firm is more productive, it is more likely to choose FDI rather than exporting. However, productivity of firms choosing whole ownership is not so different from choosing a joint venture. Furthermore, a more productive firm is more likely to conduct both whole ownership of the foreign subsidiary and a joint venture formation in the case of FDI.     

服务业与制造业对华FDI区位选择的差异——基于存量调整模型的实证研究

选取我国省级细分行业面板数据,利用存量调整模型,对服务业与制造业的对华FDI区位选择的差异进行了研究。结果表明:与经济发达国家不同,处于转轨阶段的中国制造业FDI存量调整到均衡水平的速度快于服务业;服务业和制造业跨国公司在中国投资时,服务业FDI看重市场规模和基础设施水平,受集聚因素的影响不显著,制造业则看重市场规模和劳动力成本,倾向于投资到产业集聚度高的地区。此外,由于政府优惠政策多向制造业倾斜,因而地方政府控制力越大越有利于吸引制造业FDI,而不利于吸引服务业FDI。     

世界产业结构演进影响因素的南北差异及其对中国服务业发展的启示——基于20个国家1970～2010年面板数据的实证分析

本文利用20个国家1970～2010年的数据,构建了一组面板数据计量模型,实证检验了高等教育、城市化率、FDI净流入、国民储蓄率以及贸易开放度等因素对服务业发展的影响,并通过引入贸易和储蓄二项式,测度了发达国家和不发达国家的国民储蓄率和贸易开放度对产业结构演进的影响力临界值的差异。结果表明:高等教育、城市化率、FDI净流入对服务业发展均有显著的正向作用,过度储蓄不利于产业结构的调整,而适度的贸易开放度有助于促进服务业的发展;同时,与发达国家相比,不发达经济体可以容忍一个相对较高的外贸依存度,而储蓄率也将在一个较大的范围内对不发达国家服务业发展起到抑制作用。文章对此进行了分析,并得出了一些有益的启示。     

出口还是对外直接投资:中国企业“走出去”影响因素研究

通过建立一个企业的出口与投资决策模型,文章研究了企业出口与投资选择的影响因素,并采用2003～2008年中国制造业对外直接投资的国别数据,对影响制造业对外投资倾向的因素进行了实证检验。结果表明,发达国家与新兴市场国家的相对高工资水平是制约我国制造业对其直接投资的主要因素,而贸易成本的降低使得国内企业更倾向于出口而不是对外直接投资。文章的结果同时显示,东道国的实际收入水平与研发水平对企业直接投资具有一定的吸引力,但并不显著,中国企业的对外投资行为并没有在不同发展水平的国家表现出显著的差异。本文认为,在缺乏其他特定竞争优势的条件下,促进制造业对外直接投资还需要更多政策层面的支持。     

Assessing foreign direct investment relationships between China,Japan, and the United States

China has received enormous inflows of foreign direct investment (FDI) in recent years, including significant flows from Japan and the US. We examine these investment flows in detail to gain perspectives on their relative importance for the three countries involved. We also analyze the industrial composition of FDI flows over time. American FDI flows to China have been less concentrated in manufacturing than average for investors in China while Japan's FDI flows have been much more concentrated in manufacturing, particularly in transport, electrical and machinery industries in recent years. Using survey data from American and Japanese affiliates, we compare the employment patterns and sales destinations of American and Japanese affiliates in China. We find a much higher degree of export-orientation for Japanese affiliates than American affiliates, with the latter tending to make the vast majority of their sales in the Chinese market. Over time, however, we find a tendency towards convergence in the sales destinations of Japanese and American affiliates.     

国外服务业贸易与FDI演进:文献综述及引申

国外学者关于服务贸易与产品贸易的联系与区别、影响服务贸易的因素、服务贸易的生产率效应和福利效应、服务业FDI流动、服务业FDI对生产率的影响及其福利效应、服务业贸易和服务业FDI对劳动力市场的影响等代表性研究成果表明:随着专业化分工的进一步深化以及科学的飞速发展,一些服务行业将从原有的制造业或者农业中分离出来。这就要求进一步深入对服务业贸易和服务业FDI的研究。