Investment Promotion and FDI Inflows: Quality Matters
AbstractInformation asymmetries constitute a significant obstacle to capital flows across international borders, and in particular to flows of foreign investment (FDI) to emerging markets.� Many governments aim to reduce information barriers by emerging in investment promotion activities.� Despite potentially large benefits of FDI and popularity of investment promotion intermediaries (IPIs), relatively little is known about their effectiveness.� This study uses data collected through the Global Investment Promotion Benchmarking (GIPB) exercise to examine whether higher quality of IPI services translates into higher FDI inflows.� The analysis, based on information on 156 countries, suggests that countries with IPIs able to handle investor inquiries in a more professional manner and IPIs possessing higher quality Web sites tend to attract greater volume of FDI.� These results are robust to using sector-level data and instrumental variable approach.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 612.
Date of creation: 01 Jun 2012
Date of revision:
Foreign direct investment; Investment promotion; Emerging markets; Information asymmetries; Red tape; Performance of public institutions;
Other versions of this item:
- Torfinn Harding & Beata S. Javorcik, 2013. "Investment Promotion and FDI Inflows: Quality Matters," CESifo Economic Studies, CESifo, vol. 59(2), pages 337-359, June.
- 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
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
This paper has been announced in the following NEP Reports:
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.:
- Beata S. Javorcik & Mariana Spatareanu, 2009.
"Tough Love: Do Czech Suppliers Learn from Their Relationships with Multinationals?,"
Working Papers Rutgers University, Newark
2009-004, Department of Economics, Rutgers University, Newark.
- Beata S. Javorcik & Mariana Spatareanu, 2009. "Tough Love: Do Czech Suppliers Learn from their Relationships with Multinationals?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 111(4), pages 811-833, December.
- Beata S. Javorcik & Mariana Spatareanu, 2009. "Tough Love: Do Czech Suppliers Learn from Their Relationships with Multinationals?," LICOS Discussion Papers 24909, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
- Bernard Hoekman & Beata Smarzynska Javorcik, 2006. "Global Integration and Technology Transfer," World Bank Publications, The World Bank, number 6962, March.
- Gelos, Gaston & Wei, Shang-Jin, 2004.
"Transparency and International Portfolio Holdings,"
CEPR Discussion Papers
4476, C.E.P.R. Discussion Papers.
- Torfinn Harding, Torfinn; Javorcik, Beata S., 2010.
"Roll out the Red Carpet and They Will Come: Investment Promotion and FDI Inflows,"
CAGE Online Working Paper Series
18, Competitive Advantage in the Global Economy (CAGE).
- Torfinn Harding & Beata S. Javorcik, 2011. "Roll Out the Red Carpet and They Will Come: Investment Promotion and FDI Inflows," Economic Journal, Royal Economic Society, vol. 121(557), pages 1445-1476, December.
- Beata Smarzynska Javorcik & Mariana Spatareanu, 2003.
"To share or not to share : does local participation matter for spillovers from foreign direct investment?,"
Policy Research Working Paper Series
3118, The World Bank.
- Javorcik, Beata Smarzynska & Spatareanu, Mariana, 2008. "To share or not to share: Does local participation matter for spillovers from foreign direct investment?," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 194-217, February.
- Beata Javorcik & Mariana Spatareanu, 2006. "To Share or Not To Share: Does Local Participation Matter for Spillovers from Foreign Direct Investment?," Working Papers Rutgers University, Newark 2006-001, Department of Economics, Rutgers University, Newark.
- Gustavo J. Bobonis & Howard J. Shatz, 2007. "Agglomeration, Adjustment, and State Policies in the Location of Foreign Direct Investment in the United States," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 30-43, February.
- Javorcik, Beata S. & Spatareanu, Mariana, 2011. "Does it matter where you come from? Vertical spillovers from foreign direct investment and the origin of investors," Journal of Development Economics, Elsevier, vol. 96(1), pages 126-138, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Caroline Wise).
If references are entirely missing, you can add them using this form.