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The Nested Variable Model of FDI Spillover Effects Estimation Using Hungarian Panel Data

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  • Iwasaki, Ichiro
  • Csizmadia, Péter
  • Illéssy, Miklós
  • Makó, Csaba
  • Szanyi, Miklós

Abstract

A new empirical model is presented in this paper with respect to the productivity spillover effects of foreign direct investment (FDI) by focusing on the multi-layered structure of industrial classifications. In this model, the market presence of horizontal FDI in a host country is expressed using multiple spillover variables with a nested structure corresponding to the aggregated level of industrial classification. Using large-scale firm-level data from Hungary, we estimated the nested variable model and verified horizontal FDI spillover effects that cannot be captured with the conventional model having a single horizontal variable.

Suggested Citation

  • Iwasaki, Ichiro & Csizmadia, Péter & Illéssy, Miklós & Makó, Csaba & Szanyi, Miklós, 2011. "The Nested Variable Model of FDI Spillover Effects Estimation Using Hungarian Panel Data," Discussion Paper Series 521, Institute of Economic Research, Hitotsubashi University.
  • Handle: RePEc:hit:hituec:521
    Note: May 2011 (First version: November 2009)
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    References listed on IDEAS

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    Cited by:

    1. Iwasaki, Ichiro & Tokunaga, Masahiro, 2013. "Spillover versus Ownership: A Meta-Analysis of Transition Literature," RRC Working Paper Series 42, Russian Research Center, Institute of Economic Research, Hitotsubashi University.
    2. Ichiro Iwasaki & Keiko Suganuma, 2015. "Foreign direct investment and regional economic development in Russia: an econometric assessment," Economic Change and Restructuring, Springer, vol. 48(3), pages 209-255, November.
    3. Iwasaki, Ichiro & Tokunaga, Masahiro, 2014. "Macroeconomic Impacts of FDI in Transition Economies: A Meta-Analysis," World Development, Elsevier, vol. 61(C), pages 53-69.
    4. Iwasaki, Ichiro & Csizmadia, Péter & Illéssy, Miklós & Makó, Csaba & Miklós Szanyi, 2010. "Foreign Direct Investment, Information Spillover, and Export Decision : The Concentric-Circle Model with Application to Hungarian Firm-Level Data," Discussion Paper Series a527, Institute of Economic Research, Hitotsubashi University.
    5. Iwasaki, Ichiro & Tokunaga, Masahiro, 2016. "Technology transfer and spillovers from FDI in transition economies: A meta-analysis," Journal of Comparative Economics, Elsevier, vol. 44(4), pages 1086-1114.
    6. Lengyel, Balázs & Iwasaki, Ichiro & Szanyi, Miklós, 2010. "Industry Cluster and Regional Economic Growth : Evidence from Hungary," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 51(2), pages 93-112, December.

    More about this item

    Keywords

    foreign direct investment; multinational enterprise; technology and knowledge spillover; nested variable model; Hungary;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • P23 - Economic Systems - - Socialist Systems and Transition Economies - - - Factor and Product Markets; Industry Studies; Population

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