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Capital outflow and unemployment: evidence from panel data

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  • Mei-Yin Lin
  • Jue-Shyan Wang

Abstract

The effect of moving capital abroad on the domestic labour market is ambiguous. We examine the relation between capital outflow and unemployment with the use of panel data techniques. The result shows that in developing countries, the outward direct investment is beneficial to employment and the effect of portfolio investment abroad on domestic employment is negative. However, the association between outward investment and employment is insignificant in industrial countries.

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  • Mei-Yin Lin & Jue-Shyan Wang, 2008. "Capital outflow and unemployment: evidence from panel data," Applied Economics Letters, Taylor & Francis Journals, vol. 15(14), pages 1135-1139.
    • Handle: RePEc:taf:apeclt:v:15:y:2008:i:14:p:1135-1139
    DOI: 10.1080/13504850600993655
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    1. Blomstrom, Magnus & Fors, Gunnar & Lipsey, Robert E, 1997. "Foreign Direct Investment and Employment: Home Country Experience in the United States and Sweden," Economic Journal, Royal Economic Society, vol. 107(445), pages 1787-1797, November.
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    4. Chen, Tain-Jy & Ku, Ying-Hua, 2000. "The effect of foreign direct investment on firm growth: the case of Taiwan's manufacturers," Japan and the World Economy, Elsevier, vol. 12(2), pages 153-172, May.
    5. Basu, Parantap & Ghosh, Satyajit & Kallianiotis, Ioannis, 2001. "Interest rate risk, labor supply and unemployment," Economic Modelling, Elsevier, vol. 18(2), pages 223-231, April.
    6. repec:hhs:iuiwop:490 is not listed on IDEAS
    7. Frank, Robert H. & Freeman, Richard T., 1978. "Distributional Consequences of Direct Foreign Investment," Elsevier Monographs, Elsevier, edition 1, number 9780122650505 edited by Shell, Karl.
    8. Harms, Philipp & Hefeker, Carsten, 2003. "Globalization and unemployment: the role of international diversification," Economics Letters, Elsevier, vol. 78(2), pages 281-286, February.
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    Cited by:

    1. Chella, Namapsa & Phiri, Andrew, 2017. "Long-run cointegration between foreign direct investment, direct investment and unemployment in South Africa," MPRA Paper 82371, University Library of Munich, Germany.
    2. Schmerer, Hans-Jörg, 2014. "Foreign direct investment and search unemployment: Theory and evidence," International Review of Economics & Finance, Elsevier, vol. 30(C), pages 41-56.

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