Measuring Efficiency externalities from Trade and Alternative Forms of Foreign Investment
AbstractThe literature has concentrated on evaluating technological spillovers from trade and inflows of foreign direct investment (FDI). Little effort has been directed towards identifying efficiency externalities arising from international linkages. We evaluate these for a sample of 20 OECD countries between 1982 and 2000 using a stochastic frontier approach. The analysis includes trade, inflows and outflows of FDI, foreign portfolio investment (FPI), and other foreign investment (OFI), and a measure of the absorptive capacities of host economies. We find trade and all foreign investment inflows to lead to increased efficiency. Outflows of FDI are found to exacerbate inefficiency.
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Bibliographic InfoPaper provided by School of Economics, University of Queensland, Australia in its series CEPA Working Papers Series with number WP042005.
Date of creation: Jun 2005
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-06-17 (All new papers)
- NEP-EFF-2006-06-17 (Efficiency & Productivity)
- NEP-FIN-2006-06-17 (Finance)
- NEP-INT-2006-06-17 (International Trade)
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