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FDI Contribution to Technical Efficiency in the Tunisian Manufacturing Sector

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  • Sofiane Ghali

    ()
    (University of 7 November at Carthage, Tunisia)

  • Sami Rezgui

    ()
    (University of Sousse, Tunisia)

Abstract

This paper investigates the contribution of FDI to firms' technical efficiency by applying two empirical methodologies over the same sample of firms. Using a panel data for 674 firms belonging to the Tunisian manufacturing sector and observed over the period 1997-2001, we show statistically and econometrically that the robustness of FDI spillover effects is affected by the empirical methodology adopted. On the basis of TFP growth decomposition, our results also show that when spillover effects could be confirmed, they are, for a large proportion of firms, counterbalanced by internal technical inefficiency. This last result confirms the idea that FDI contribution to technical efficiency relies mainly on the firm’s internal organizational and absorptive capacities.

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Bibliographic Info

Paper provided by Economic Research Forum in its series Working Papers with number 421.

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Length: 20 pages
Date of creation: Aug 2008
Date of revision: Aug 2008
Publication status: Published by The Economic Research Forum (ERF)
Handle: RePEc:erg:wpaper:421

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