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Foreign Direct Investment and Trade: A Causality Analysis

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  • Oscar Bajo-Rubio

    ()

  • María Montero-Muñoz

    ()

Abstract

In this article, we analyze the relationship between outward foreign direct investment (FDI) and exports, using Spanish quarterly data for the period 1977–1998, by means of Granger causality tests in a cointegration framework. Our results point to the existence of a relationship of complementarity between both variables, with Granger causality running in the short run from outward FDI to exports, and bilateral Granger causality in the long run. Copyright Kluwer Academic Publishers 2001

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File URL: http://hdl.handle.net/10.1023/A:1011185507169
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Bibliographic Info

Article provided by Springer in its journal Open Economies Review.

Volume (Year): 12 (2001)
Issue (Month): 3 (July)
Pages: 305-323

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Handle: RePEc:kap:openec:v:12:y:2001:i:3:p:305-323

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Web page: http://www.springerlink.com/link.asp?id=100323

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Keywords: foreign direct investment; exports; Granger causality;

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References

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Citations

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Cited by:
  1. Pradhan, Jaya Prakash, 2007. "How Do Indian Multinationals Affect Exports from Home Country?," MPRA Paper 19022, University Library of Munich, Germany.
  2. Yi Zhang, 2009. "Unravelling the complex motivations behind China’s FDI," Working Papers 09-02, Utrecht School of Economics.
  3. M. T. Alguacil & V. Orts, 2003. "Inward Foreign Direct Investment and Imports in Spain," International Economic Journal, Taylor & Francis Journals, vol. 17(3), pages 19-38.
  4. Timo Mitze & Björn Alecke & Gerhard Untiedt, 2009. "Trade-FDI Linkages in a System of Gravity Equations for German Regional Data," Ruhr Economic Papers 0084, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  5. Raphaël Chiappini, 2012. "Un réexamen de la relation entre commerce et Investissement Direct à l'étranger (IDE) à partir d'un modèle en panel dynamique Le cas de l'Allemagne, la France et l'Italie," Working Papers hal-00744405, HAL.
  6. Mariam Camarero & Cecilio Tamarit, 2003. "Estimating exports and imports demand for Manufactured goods: The role of FDI," European Economy Group Working Papers 22, European Economy Group.
  7. Oscar Bajo & María Montero, . "Foreign direct investment and trade: A causality analysis," Studies on the Spanish Economy 06, FEDEA.
  8. Mitze, Timo & Alecke, Björn & Untiedt, Gerhard, 2008. "Trade, FDI and Cross-Variable Linkages: A German (Macro-)Regional Perspective," MPRA Paper 12245, University Library of Munich, Germany.
  9. M. T. Alguacil & V. Orts, . "Inward Foreign Direct Investment and Imports in Spain," Working Papers on International Economics and Finance 02-01, FEDEA.
  10. Raphaël Chiappini, 2012. "Un réexamen de la relation entre commerce et Investissement Direct à l’étranger (IDE) à partir d’un modèle en panel dynamique Le cas de l’Allemagne, la France et l’Italie," Larefi Working Papers 1204, Larefi, Université Bordeaux 4.
  11. Yan Chen & Wen-Chung Hsu & Chengqi Wang, 2012. "Effects of outward FDI on home-country export competitiveness: The role of location and industry heterogeneity," Journal of Chinese Economic and Foreign Trade Studies, Emerald Group Publishing, vol. 5(1), pages 56-73, February.

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