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FDI in Business Services has general TFP effects : evidence from Italy

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This paper studies the effect of FDI in business services on Total Factor Productivity of Italian manufacturing firms, over the period 2003-2008. More precisely, the paper tests the impact of forward inter industry linkages at local level. Our results, robust to different specifications, show that foreign capital infl ows improve the performance of domestic manufacturing firms. This relationship is particularly strong in the case of high tech sectors, such as mechanics and machinery. Traditional sectors, on the other hand, seem to be less sensitive to the availability of foreign business services in the same location.

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Paper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa in its series Working Papers - Economics with number wp2011_12.rdf.

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Date of creation: 2011
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Handle: RePEc:frz:wpaper:wp2011_12.rdf

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