The effect of inward FDI on outward FDI over time in China: A contingent and dynamic perspective

Drawing on the investment development path (IDP) framework and foreign direct investment (FDI) spillover literature, this study attempts to identify the contingent and dynamic effect of inward FDI (IFDI) on outward FDI (OFDI) at a provincial level. Using panel data from China, our findings reveal that the positive effect of IFDI on OFDI is stronger in provinces with high economic development, albeit at a diminishing rate over time. However, the level of corruption weakens the effect of IFDI on OFDI over time. Despite that, we find that the effect of IFDI on OFDI is not contingent on trade openness overall. By decomposing trade openness into two dimensions, that is, import intensity and export intensity, our findings indicate that the effect of IFDI on OFDI depends on export intensity, rather than import intensity. Our study provides insights into the complex effect of IFDI on OFDI from a contingent and dynamic perspective.     

The Role of Location as a Selection Criterion in FDI: The Case of SMEs in Greece

The study examines the internationalization of Greek SMEs in Western Europe and the Balkan area, focusing on the role of location as a selection criterion in their FDI decisions. Data aimed at capturing SMEs’ perceptions with regard to incentives affecting their FDI based on location criteria. We find that location plays a significant role with regard to the benefits that firms gain, highlighting OLI paradigm's theoretical relevance in the examination of FDI, while presenting internationalization trends in the global environment. Findings further contribute to the adaption of effective practices to enhance firms’ competitiveness through more rational and targeted investment decisions.     

Pro-market institutions and outward FDI of emerging market firms: An institutional arbitrage logic

We offer new theory and evidence regarding the effects of pro-market institutions on outward foreign direct investment (FDI) of emerging market firms (EMFs). Drawing on the logic of institutional arbitrage, we integrate the escapism and exploitation mechanisms of EMF internationalization into a unified theoretical context. We propose an inverted U-shaped relationship between host market-supporting institutions (MSI) and the investment scale of an EMF’s FDI project in the country, showing an escape-driven upward slope for low-to-medium MSI levels and an exploitation-driven downward slope for medium-to-high MSI levels. We supplement this main argument with two boundary conditions: the alleviating effect of home market liberalization (HML) and the strengthening effect of home government subsidies (HGS), demonstrating the coexistence and variation of pro- and anti- market institutions in an emerging market. Using information on 1,450 FDI projects conducted by 288 Chinese listed firms in 116 host countries, we obtain supportive evidence for the predicted relationships between the three institutional forces. This study enriches the literatures on institutional arbitrage and pro-market institutions with evidence from EMFs.     

Modeling FDI based on a spatially augmented gravity model: Evidence for Central and Eastern European Countries

Based on a spatially augmented gravity model, the current paper isolates spatial interrelationships in foreign direct investment (FDI) to Central and Eastern European Countries (CEECs) not only across the destination but also across the origin country dimension of FDI. Results show that (i) spatial interrelationships across destination countries are present and are consistent with the predominance of vertical-complex FDI in total FDI; (ii) spatial correlation across origin countries is given in earlier years of transition, while spillover and competition effects cancel over the whole sample period; and (iii) agglomeration forces gain in importance for FDI to CEECs.     

Neither developed nor emerging: Dual paths for outward FDI and home country innovation in emerged market MNCs

Emerged market multinational corporations (EDMNCs) ? those based in emerged markets that have transitioned out of emerging economic status ? have received little research interest from the international business scholarship, despite their growing presence in the global market. EDMNCs face significant competitive pressure to leverage cross-border knowledge to innovate and leapfrog their middle-zone status between emerging and developed market multinational corporations. Analyzing 174 publicly listed South Korean MNCs and their outward foreign direct investment (OFDI), we find that an EDMNC’s OFDI into developed and emerging markets contributes unequally to its home-country innovation. We also elaborate on the moderating effect of industry peers’ OFDI into developed countries through crowding out and spillover effects. These findings have implications for the OFDI and innovation literature in general, and particularly for international business scholarship focusing on an under-investigated category of MNCs that are increasingly becoming successful in international competition.     

Antitrust policy and inward FDI: The impact of policy risk and uncertainty on U.S. inward-FDI flows

The enforcement of antitrust policy potentially affects the level of foreign investment experienced by a nation. Yet the literature focusing on the impact of antitrust on inward foreign direct investment (FDI) is inconclusive with respect to the nature of this relationship, as antitrust involves properties that can both promote and deter foreign investment. In line with these countervailing conceptual underpinnings, the empirical literature on this topic also presents mixed findings. We argue that distinguishing between the policy risk and policy uncertainty characteristic of antitrust allows reconciling these competing perspectives. We employ sector-level data on U.S. antitrust and inward-FDI flows over the 2002–2018 period. Our panel-data empirical results indicate that the policy-risk elements of antitrust enforcement foster inward FDI, while the policy-uncertainty elements of antitrust enforcement deter inward FDI.     

Remittances and FDI Effects on Economic Growth: A VECM and GIRFs for the Case of Albania

ABSTRACT

This paper analyzes the effects of remittances and foreign direct investments (FDI) on economic growth, gross fixed capital formation (GFCF), and inflation in Albania through a vector error correction model. The results show that remittances Granger-cause positively economic growth short- and long-run and negatively inflation, while no significant relationship has been established between remittances and GFCF. The findings support that remittances, apart from affecting economic growth, disinflate the Albanian economy. With respect to FDI, there are signs that inflation Granger-causes negatively FDI, while there appears to be no relationship between FDI, economic growth, and capital formation.