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Foreign direct investment and export spillovers: Evidence from Vietnam

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  • Anwar, Sajid
  • Nguyen, Lan Phi

Abstract

The existing IB literature suggests that the presence of foreign firms in a country can benefit domestic firms through the formation of inter-firm linkages. These linkages can take various forms. By making use of firm level data from Vietnam's manufacturing sector, this paper examines the impact of horizontal and vertical (backward and forward) linkages between domestic and foreign firms on (i) the decision of domestic firms to export and (ii) the export share of domestic firms. This paper considers only transactional linkages. The empirical analysis is based on Heckman's two-step estimator in selection models. It is shown that the presence of foreign firms in Vietnam, through horizontal and forward linkages, significantly affects the decision of domestic firms to export as well as their export share. This result continues to hold when we take into account factors such as the (a) level of technology of domestic firms, (b) ownership structure of domestic firms, (c) orientation of foreign firms and (d) geographical proximity to foreign firms.

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Bibliographic Info

Article provided by Elsevier in its journal International Business Review.

Volume (Year): 20 (2011)
Issue (Month): 2 (April)
Pages: 177-193

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Handle: RePEc:eee:iburev:v:20:y:2011:i:2:p:177-193

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Keywords: Foreign direct investment Export spillovers Emerging economies;

References

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Cited by:
  1. Elisa Giuliani & Chiara Macchi, 2013. "Multinational Corporations’ Economic And Human Rights Impacts On Developing Countries: A Review And Research Agenda," Discussion Papers 2013/158, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
  2. Anwar, Sajid & Sun, Sizhong, 2012. "FDI and market entry/exit: Evidence from China," Journal of Asian Economics, Elsevier, vol. 23(5), pages 487-498.
  3. Franco, Chiara, 2013. "Exports and FDI motivations: Empirical evidence from U.S. foreign subsidiaries," International Business Review, Elsevier, vol. 22(1), pages 47-62.

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