IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Property Rights, Tax Incentives and Bogus FDI

Listed author(s):
  • Haozhen Zhang


    (Health Canada)

Registered author(s):

    To our knowledge, this paper provides the first evidence of the effects of FDI round-tripping incentives on the scale of round-tripping. We find that round-tripping could be an explanation for the data reporting discrepancies between FDI host and source countries since investors have no incentive to report their ¡°bogus¡± foreign investment to their source countries. If the data reporting discrepancies were caused partly by round-tripping, those reporting differences should be correlated with round-tripping incentives. Therefore, we first calculate the difference between the FDI inflows from 10 source regions reported by 50 host countries and FDI outflows reported by these 10 source regions. Second, these reporting differences are regressed on measures of the host countries¡¯ political stability, property rights protection and preferential fiscal incentives to foreign investment. Our results from both aggregate and disaggregated data show that the FDI reporting differences are positively related to the host countries¡¯ preferential fiscal incentives, and negatively correlated with the host country¡¯s property rights protection and political stability. These results are statistically significant and robust to different function specifications and different indicators for property rights protection.

    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.

    File URL:
    Download Restriction: no

    Article provided by Ottawa United Learning Academy in its journal Transnational Corporations Review.

    Volume (Year): 4 (2012)
    Issue (Month): 4 (December)
    Pages: 19-45

    in new window

    Handle: RePEc:oul:tncr09:v:4:y:2012:i:4:p:19-45
    Contact details of provider: Postal:
    1568 Merivale Rd. Suite # 618, Ottawa, Ontario, Canada K2G 5Y7

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:oul:tncr09:v:4:y:2012:i:4:p:19-45. 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: (Denny Liao)

    or (Jen Ma)

    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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.