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FDI and intra-industry trade: theory and empirical evidence from the Visegrad Countries

  • Lukasz Ambroziak

This paper analyses impact of the foreign direct investment (FDI) on the intra-industry trade (IIT) patterns in the Visegrad Countries (VCs) (the Czech Republic, Hungary, Poland and Slovakia) in the period 1995–2008. The FDI has been a driving force of these countries’ foreign trade, especially for the IIT. From the theory and previous empirical studies, it results that the FDI has a positive impact on vertical intra-industry trade (VIIT), while the influence of this variable on horizontal intra-industry trade (HIIT) is ambiguous. Using a panel data approach, the determinants of HIIT and VIIT were identified. The obtained results confirmed that the FDI in the VCs stimulated not only VIIT, but also HIIT.

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Article provided by Inderscience Enterprises Ltd in its journal Int. J. of Economics and Business Research.

Volume (Year): 4 (2012)
Issue (Month): 1/2 ()
Pages: 180-198

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Handle: RePEc:ids:ijecbr:v:4:y:2012:i:1/2:p:180-198
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