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Foreign direct investment and trade: A causality analysis

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  • Oscar Bajo
  • María Montero

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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Paper provided by FEDEA in its series Studies on the Spanish Economy with number 06.

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Handle: RePEc:fda:fdaeee:06

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Citations

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Cited by:
  1. 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, Larefi, Université Bordeaux 4 1204, Larefi, Université Bordeaux 4.
  2. 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 hal-00744405, HAL.
  3. Oscar Bajo-Rubio & María Montero-Muñoz, 2001. "Foreign Direct Investment and Trade: A Causality Analysis," Open Economies Review, Springer, Springer, vol. 12(3), pages 305-323, July.
  4. Timo Mitze & Björn Alecke & Gerhard Untiedt, 2009. "Trade-FDI Linkages in a System of Gravity Equations for German Regional Data," Ruhr Economic Papers, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen 0084, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  5. Yi Zhang, 2009. "Unravelling the complex motivations behind China’s FDI," Working Papers, Utrecht School of Economics 09-02, Utrecht School of Economics.
  6. M. T. Alguacil & V. Orts, . "Inward Foreign Direct Investment and Imports in Spain," Working Papers on International Economics and Finance 02-01, FEDEA.
  7. M. T. Alguacil & V. Orts, 2003. "Inward Foreign Direct Investment and Imports in Spain," International Economic Journal, Taylor & Francis Journals, Taylor & Francis Journals, vol. 17(3), pages 19-38.
  8. Mariam Camarero & Cecilio Tamarit, 2003. "Estimating exports and imports demand for Manufactured goods: The role of FDI," European Economy Group Working Papers, European Economy Group 22, European Economy Group.
  9. Pradhan, Jaya Prakash, 2007. "How Do Indian Multinationals Affect Exports from Home Country?," MPRA Paper 19022, University Library of Munich, Germany.
  10. Emilia Penkova-Pearson, 2012. "Trade, convergence and exchange rate regime: evidence from Bulgaria and Romania," Journal of Central Banking Theory and Practice, Central bank of Montenegro, Central bank of Montenegro, vol. 1(1), pages 107-139.
  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, Emerald Group Publishing, vol. 5(1), pages 56-73, February.
  12. 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.

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