Competition between Latin America and China for US direct investment
AbstractThere is a belief that the Chinese economy competes with the Latin-American ones for investment flows. Here we analyze the determinants of the US FDI outflows to the most representative Latin-American economies. We develop such assessment with a double-procedure cointegration analysis based on the time-series methodologies of Toda and Yamamoto (1995) and Liu, Song and Romilly (1997). The results suggest that long-run investment to the Latin-American region mainly depends on the performance of the US economy. Furthermore, they suggest the existence of a substitution effect between the Latin American countries and China for US investment flows.
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 Library of Munich, Germany in its series MPRA Paper with number 8950.
Date of creation: 01 Feb 2008
Date of revision:
FDI; Latin America; China; US; Cointegration;
Other versions of this item:
- De la Cruz Gallegos Jose Luis & Ivanova Boncheva Antonina & Ruiz-Porras Antonio, 2008. "Competition between Latin America and China for US Direct Investment," Global Economy Journal, De Gruyter, vol. 8(2), pages 1-22, June.
- F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
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.:
- Eichengreen, Barry & Tong, Hui, 2007.
"Is China's FDI coming at the expense of other countries?,"
Journal of the Japanese and International Economies,
Elsevier, vol. 21(2), pages 153-172, June.
- Barry Eichengreen & Hui Tong, 2005. "Is China's FDI Coming at the Expense of Other Countries?," NBER Working Papers 11335, National Bureau of Economic Research, Inc.
- Awokuse, Titus O., 2002.
"Is The Export-Lead Growth Hypothesis Valid For Canada?,"
15823, University of Delaware, Department of Food and Resource Economics.
- Titus O. Awokuse, 2003. "Is the export-led growth hypothesis valid for Canada?," Canadian Journal of Economics, Canadian Economics Association, vol. 36(1), pages 126-136, February.
- Alicia García-Herrero & Daniel Santabárbara, 2005.
"Does China have an impact on foreign direct investment to Latin America?,"
Banco de Espaï¿½a Working Papers
0517, Banco de Espa�a.
- Garcia-Herrero, Alicia & Santabarbara, Daniel, 2007. "Does China have an impact on foreign direct investment to Latin America?," China Economic Review, Elsevier, vol. 18(3), pages 266-286.
- Daniel Santabarbara & Alicia Garcia-Herrero, 2005. "Does China have an impact on foreign direct investment to Latin America?," International Finance 0508008, EconWPA.
- Alicia Garcia-Herrero & Daniel Santabarbara, 2005. "Does China have an impact on foreign direct investment to Latin America?," International Finance 0508010, EconWPA.
- Quintos, Carmela E., 1998. "Stability tests in error correction models," Journal of Econometrics, Elsevier, vol. 82(2), pages 289-315, February.
- Eduardo Lora, 2005.
"Should Latin America Fear China?,"
Research Department Publications
4419, Inter-American Development Bank, Research Department.
- Peter K. Schott, 2006. "The relative revealed competitiveness of China's exports to the United States vis a vis other countries in Asia, the Caribbean, Latin America and the OECD," INTAL Working Papers 1285, Inter-American Development Bank, INTAL.
- Ana María Cuadros Ramos, 2000. "Exportaciones y crecimiento económico: Un análisis de causalidad para México," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 15(1), pages 37-64.
- Chandana Chakraborty & Parantap Basu, 2002. "Foreign direct investment and growth in India: a cointegration approach," Applied Economics, Taylor & Francis Journals, vol. 34(9), pages 1061-1073.
- A. Hatemi-J, 2003. "A new method to choose optimal lag order in stable and unstable VAR models," Applied Economics Letters, Taylor & Francis Journals, vol. 10(3), pages 135-137.
- Abugri, Benjamin A., 2008. "Empirical relationship between macroeconomic volatility and stock returns: Evidence from Latin American markets," International Review of Financial Analysis, Elsevier, vol. 17(2), pages 396-410.
- Lokman Gunduz & Abdulnasser Hatemi-J, 2005. "Is the tourism-led growth hypothesis valid for Turkey?," Applied Economics Letters, Taylor & Francis Journals, vol. 12(8), pages 499-504.
- Toda, Hiro Y. & Yamamoto, Taku, 1995. "Statistical inference in vector autoregressions with possibly integrated processes," Journal of Econometrics, Elsevier, vol. 66(1-2), pages 225-250.
- Cravino, Javier & Lederman, Daniel & Olarreaga, Marcelo, 2007. "Foreign direct investment in Latin America during the emergence of China and India : stylized facts," Policy Research Working Paper Series 4360, The World Bank.
- Xiaming Liu & Haiyan Song & Peter Romilly, 1997. "An empirical investigation of the causal relationship between openness and economic growth in China," Applied Economics, Taylor & Francis Journals, vol. 29(12), pages 1679-1686.
- Christopher A. Sims, 1992.
"Interpreting the Macroeconomic Time Series Facts: The Effects of Monetary Policy,"
Cowles Foundation Discussion Papers
1011, Cowles Foundation for Research in Economics, Yale University.
- Sims, Christopher A., 1992. "Interpreting the macroeconomic time series facts : The effects of monetary policy," European Economic Review, Elsevier, vol. 36(5), pages 975-1000, June.
- repec:idb:brikps:8551 is not listed on IDEAS
- McMillin, W Douglas, 1988. "Money Growth Volatility and the Macroeconomy," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 20(3), pages 319-35, August.
- Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
- Xiaohui Liu & Peter Burridge & P. J. N. Sinclair, 2002. "Relationships between economic growth, foreign direct investment and trade: evidence from China," Applied Economics, Taylor & Francis Journals, vol. 34(11), pages 1433-1440.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.