Does FDI Accelerate Economic Growth? The OECD Experience Based on Panel Data Estimates for the Period 1980-2004
Although empirical literature offers rich insights on the relationship of FDI and economic growth, it provides mixed evidence on the existence of productivity externalities in the host country generated by foreign multinational companies. A branch of literature suggests that the positive impact of FDI is conditional on countries stock of human capital or a threshold absorptive capacity. Most of the studies that came up with these conclusions are either based on developing or a mix of developing and developed country experiences. There is a dearth of literature explicitly focused on developed country experiences. Moreover, most literature has focused on the impact of inward FDI on host country economic growth. Does outward FDI exert any influence on source country economic growth? This paper addresses these issues using panel time series data from 25 OECD countries for the period 1980-2004 in a cross-country regression framework. It finds that both inward and outward are positively correlated with host and source country economic growth. However, the impact of FDI on economic growth is moderate. Results suggest that the elasticity of GDP growth with respect to both inward and outward FDI in the host and source countries is about 0.01.
If 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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 9 (2010)
Issue (Month): 4 (January)
|Contact details of provider:|| Web page: http://www.degruyter.com|
|Order Information:||Web: http://www.degruyter.com/view/j/gej|
When requesting a correction, please mention this item's handle: RePEc:bpj:glecon:v:9:y:2010:i:4:n:1. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.