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Revaluing the capital stock of international production

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  • Bellak, Christian
  • Cantwell, John

Abstract

The objective of the paper is to report on the effect of revaluing foreign direct investment (FDI) at replacement values as a means of estimating the importance of international production. A perpetual inventory model is used to revalue FDI stocks to constant and current values. The empirical results show the extent of the revaluation of inward and outward FDI stocks of the US, the UK, Germany, and Japan. Meaningful comparisons across countries require the translation of FDI stocks in a common currency and at constant prices and exchange rates. Such comparisons reveal that compared to other macroeconomic indicators, FDI has been undervalued.

Suggested Citation

  • Bellak, Christian & Cantwell, John, 2004. "Revaluing the capital stock of international production," International Business Review, Elsevier, vol. 13(1), pages 1-18, February.
    • Handle: RePEc:eee:iburev:v:13:y:2004:i:1:p:1-18
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    References listed on IDEAS

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    Cited by:

    1. Lundan, Sarianna M., 2007. "The Home Country Effects of Internationalisation," Discussion Papers 1100, The Research Institute of the Finnish Economy.
    2. Wang, Elizabeth Yi & Kafouros, Mario, 2020. "Location still matters! How does geographic configuration influence the performance-enhancing advantages of FDI spillovers?," Journal of International Management, Elsevier, vol. 26(3).
    3. repec:bla:jcmkts:v:46:y:2008:i::p:969-1000 is not listed on IDEAS
    4. Carlos M. Fernández-Otheo & Rafael Myro, "undated". "Is the foreign capital leaving industrialized countries? The case of Spain," Working Papers on International Economics and Finance 04-03, FEDEA.

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