IDEAS home Printed from
MyIDEAS: Login to save this article or follow this journal

Foreign Direct Investment and Regional Growth: An Analysis of the Spanish Case

  • Oscar Bajo-Rubio
  • Carmen Diaz-Mora
  • Carmen Diaz-Roldan

Bajo-Rubio O., Diaz-Mora C. and Diaz-Roldan C. Foreign direct investment and regional growth: an analysis of the Spanish case, Regional Studies. The massive increase in foreign direct investment (FDI) inflows following the Spanish integration with the now European Union in 1986 has been one of the most important features shaping the behaviour of the Spanish economy in the last 20 years. This paper assesses the impact of foreign direct investment on regional economic growth following Spain's entry into the European Union, using data for the 17 Spanish regions. The results support the important role played by foreign direct investment in promoting productivity growth over the period analysed, which proves to be robust to several alternative specifications. [image omitted] Bajo-Rubio O., Diaz-Mora C. et Diaz-Roldan C. Investissement etranger direct et croissance regional: une analyse du cas espagnol, Regional Studies. Le massif accroissement des entrees d'investissement etranger direct (IED) apres l'integration espagnole dans l'actuelle Union Europeenne (UE) en 1986, a ete l'un des principaux traits configurant l'evolution de l'economie espagnole des vingt dernieres annees. Dans cet article, nous essayerons d'evaluer l'impact de l'IED sur la croissance economique regionale apres l'entree de l'Espagne dans l'UE, en utilisant des donnees des 17 regions espagnoles. Les resultats confirment l'important role joue par l'IED en favorisant la croissance de la productivite tout au long de la periode analysee, ces resultats etant robustes a diverses specifications alternatives. Croissance economique Investissement etranger direct Regions Bajo-Rubio O., Diaz-Mora C. und Diaz-Roldan C. Auslandische Direktinvestitionen und regionales Wachstum: eine Analyse des Falls von Spanien, Regional Studies. Der massive Anstieg auslandischer Direktinvestitionen in Spanien nach der Integration des Landes in die heutige Europaische Union im Jahr 1986 war eines der wichtigsten Merkmale, die das Verhalten der spanischen Wirtschaft in den letzten zwanzig Jahren pragten. In diesem Beitrag versuchen wir, die Auswirkung der auslandischen Direktinvestitionen auf das regionale Wirtschaftswachstum nach dem EU-Beitritt Spaniens anhand von Daten fur die 17 spanischen Regionen zu bewerten. Die Ergebnisse bekraftigen die wichtige Rolle der auslandischen Direktinvestitionen bei der Forderung des Produktivitatswachstums uber den analysierten Zeitraum - ein Ergebnis, das sich auch in Verbindung mit mehreren alternativen Spezifikationen als robust erweist. Wirtschaftswachstum Auslandische Direktinvestitionen Regionen Bajo-Rubio O., Diaz-Mora C. y Diaz-Roldan C. Inversion extranjera directa y crecimiento regional: un analisis del caso espanol, Regional Studies. El masivo incremento de las entradas de inversion extranjera directa (IED) tras la integracion espanola en la actual Union Europea (UE) en 1986, ha sido uno de los rasgos mas importantes que configuran la evolucion de la economia espanola en los ultimos veinte anos. En este articulo trataremos de evaluar el impacto de la IED sobre el crecimiento economico regional tras la entrada de Espana en la UE, utilizando datos para las 17 regiones espanolas. Los resultados confirman el importante papel desempenado por la IED a la hora de favorecer el crecimiento de la productividad a lo largo del periodo analizado, siendo estos resultados robustos a diversas especificaciones alternativas. Crecimiento economico Inversion extranjera directa Regiones

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: Access to full text is restricted to subscribers.

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.

Article provided by Taylor & Francis Journals in its journal Regional Studies.

Volume (Year): 44 (2010)
Issue (Month): 3 ()
Pages: 373-382

in new window

Handle: RePEc:taf:regstd:v:44:y:2010:i:3:p:373-382
Contact details of provider: Web page:

Order Information: Web:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Carlos M. Fernández-Otheo & Rafael Myro, . "Is the foreign capital leaving industrialized countries? The case of Spain," Working Papers on International Economics and Finance 04-03, FEDEA.
  2. Blomstrom, Magnus & Kokko, Ari, 1998. " Multinational Corporations and Spillovers," Journal of Economic Surveys, Wiley Blackwell, vol. 12(3), pages 247-77, July.
  3. Balasubramanyam, V N & Salisu, M & Sapsford, David, 1996. "Foreign Direct Investment and Growth in EP and IS Countries," Economic Journal, Royal Economic Society, vol. 106(434), pages 92-105, January.
  4. Giovanni Peri, 2004. "Catching-Up to Foreign Technology? Evidence on the "Veblen-Gerschenkron" Effect of Foreign Investments," NBER Working Papers 10893, National Bureau of Economic Research, Inc.
  5. Borensztein, E. & De Gregorio, J. & Lee, J-W., 1998. "How does foreign direct investment affect economic growth?1," Journal of International Economics, Elsevier, vol. 45(1), pages 115-135, June.
  6. Romer, Paul, 1993. "Idea gaps and object gaps in economic development," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 543-573, December.
  7. Sebnem Kalemli-Ozcan & Laura Alfaro & Selin Sayek & Areendam Chanda, 2002. "FDI and Economic Growth: The Role of Local Financial Markets," Macroeconomics 0212007, EconWPA.
  8. Brems, Hans, 1970. "A Growth Model of International Direct Investment," American Economic Review, American Economic Association, vol. 60(3), pages 320-31, June.
  9. Paul M Romer, 1999. "Endogenous Technological Change," Levine's Working Paper Archive 2135, David K. Levine.
  10. Beñat Bilbao-Osorio & Andrés Rodríguez-Pose, 2004. "From R&D to Innovation and Economic Growth in the EU," Growth and Change, Wiley Blackwell, vol. 35(4), pages 434-455.
  11. Ann E. Harrison & Brian J. Aitken, 1999. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," American Economic Review, American Economic Association, vol. 89(3), pages 605-618, June.
  12. Laureti, Lucio & Postiglione, Paolo, 2005. "The effects of capital inflows on the economic growth in the Med Area," Journal of Policy Modeling, Elsevier, vol. 27(7), pages 839-851, October.
  13. Holger Görg & David Greenaway, 2004. "Much Ado about Nothing? Do Domestic Firms Really Benefit from Foreign Direct Investment?," World Bank Research Observer, World Bank Group, vol. 19(2), pages 171-197.
  14. Barrios, Salvador & Gorg, Holger & Strobl, Eric, 2005. "Foreign direct investment, competition and industrial development in the host country," European Economic Review, Elsevier, vol. 49(7), pages 1761-1784, October.
  15. Blundell, R. & Bond, S., 1995. "Initial Conditions and Moment Restrictions in Dynamic Panel Data Models," Economics Papers 104, Economics Group, Nuffield College, University of Oxford.
  16. Bond, Stephen Roy & Hoeffler, Anke & Temple, Jonathan, 2001. "GMM Estimation of Empirical Growth Models," CEPR Discussion Papers 3048, C.E.P.R. Discussion Papers.
  17. Nauro F. Campos & Yuko Kinoshita, 2002. "Foreign Direct Investment as Technology Transferred: Some Panel Evidence from the Transition Economies," William Davidson Institute Working Papers Series 438, William Davidson Institute at the University of Michigan.
  18. Wang, Jian-Ye, 1990. "Growth, technology transfer, and the long-run theory of international capital movements," Journal of International Economics, Elsevier, vol. 29(3-4), pages 255-271, November.
  19. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 277-97, April.
  20. Durham, J.B.J. Benson, 2004. "Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth," European Economic Review, Elsevier, vol. 48(2), pages 285-306, April.
  21. Gao, Ting, 2005. "Foreign direct investment and growth under economic integration," Journal of International Economics, Elsevier, vol. 67(1), pages 157-174, September.
  22. Óscar Bajo Rubio & Carmen Díaz Roldán & M.Dolores Montávez Garcés, 2002. "Optimal Endowments of Public Investment: An Empirical Analysis for the Spanish Regions," Economic Working Papers at Centro de Estudios Andaluces E2002/14, Centro de Estudios Andaluces.
  23. M Arellano & O Bover, 1990. "Another Look at the Instrumental Variable Estimation of Error-Components Models," CEP Discussion Papers dp0007, Centre for Economic Performance, LSE.
  24. Ledyaeva , Svetlana & Linden, Mikael, 2006. "Foreign direct investment and economic growth: Empirical evidence from Russian regions," BOFIT Discussion Papers 17/2006, Bank of Finland, Institute for Economies in Transition.
  25. N. Gregory Mankiw & David Romer & David N. Weil, 1990. "A Contribution to the Empirics of Economic Growth," NBER Working Papers 3541, National Bureau of Economic Research, Inc.
Full references (including those not matched with items on IDEAS)

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:taf:regstd:v:44:y:2010:i:3:p:373-382. 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: (Michael McNulty)

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.