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Home Versus Host Country Effects of FDI: Searching for New Evidence of Productivity Spillovers Author info | Abstract | Publisher info | Download info | Related research | Statistics Priit Vahter ()
Jaan Masso ()
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The aim of this paper is to study the effects of both inward and outward foreign direct investment (FDI) on productivity. The main novelty is the analysis of the spillover effects of outward FDI that may occur outside the investing firms on the rest of the home country. The effects are addressed both for the manufacturing and services sectors. To our best knowledge there have so far been no studies based on enterprise-level panel data analysing the spillovers of outward FDI in the production function estimation framework. We find that engaging in outward FDI or receiving inward FDI is positively related to the productivity of the parent firm in Estonia or the subsidiary in Estonia. We do not find much evidence of positive spillovers via outward or inward FDI that is robust to the specification of the model or does not depend on the sector being studied. The results on spillover effects vary according to different specifications of the spillover variable, sector or the model, being either statistically insignificant or, in some cases, positive.
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Paper provided by Bank of Estonia in its series Bank of Estonia Working Papers with number
2005-13.
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Length: 47 pages
Date of creation: 10 Dec 2005Date of revision:
10 Dec 2005Publication status: publishedHandle: RePEc:eea:boewps:wp2005-13Contact details of provider: Postal: Estonia bld. 13, 15095 Tallinn, ESTONIA Phone: +3726680719 Fax: +3726680900 Email: Web page: http://www.bankofestonia.info More information through EDIRC
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Keywords: foreign direct investment spillovers home country effects productivity Other versions of this item:
Find related papers by JEL classification: F10 - International Economics - - Trade - - - General F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Priit Vahter, 2006.
"Productivity in Estonian enterprises: the role of innovation and competition ,"
Bank of Estonia Working Papers
2006-07, Bank of Estonia, revised 11 Dec 2006.
[Downloadable!]
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