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Technological Spillovers from Foreign Direct Investment - A Survey

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  • Emma Xiaoqin Fan

    (Asian Development Bank)

Abstract

The spillover effect has been identified as an important channel through which domestic firms benefit from foreign direct investment (FDI). It is also considered an important conduit through which FDI promotes growth in a host country. Realization of this and other benefits arising from FDI has prompted governments to encourage FDI inflow. The increased FDI flows have further stimulated intensive debate and research on the role of FDI on host economies. This paper surveys the substantial literature exploring FDI and spillover effects. Its purpose is to summarize the main findings from previous research, and identify missing aspects in existing studies and essential elements that should be included in future studies. The paper also reviews research on FDI in the People's Republic of China (PRC) alongside the general literature on FDI. Over the last two decades, the PRC has emerged as one of the largest hosts of FDI in the world. Studies on the PRC are particularly useful in illuminating the likely direction of FDI research in developing countries, especially the transition economies.

Suggested Citation

  • Emma Xiaoqin Fan, 2002. "Technological Spillovers from Foreign Direct Investment - A Survey," ADB Economics Working Paper Series 33, Asian Development Bank.
    • Handle: RePEc:ris:adbewp:0033
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    References listed on IDEAS

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    1. Wei, Shang-Jin, 1995. "Attracting foreign direct investment: Has China reached its potential?," China Economic Review, Elsevier, vol. 6(2), pages 187-199.
    2. Zhang, Le-Yin, 1994. "Location-specific advantages and manufacturing direct foreign investment in South China," World Development, Elsevier, vol. 22(1), pages 45-53, January.
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    Cited by:

    1. Hrushikesh Mallick, 2024. "Does onslaught of globalisation induce pro-efficient government expenditures in a large transitioning economy? Empirical evidence from India," Economic Change and Restructuring, Springer, vol. 57(2), pages 1-46, April.
    2. Shenali Nupehewa & Sachintha Liyanage & Deshan Polkotuwa & Madhurshi Thiyagarajah & Ruwan Jayathilaka & Anuja Lokeshwara, 2022. "More than just investment: Causality analysis between foreign direct investment and economic growth," PLOS ONE, Public Library of Science, vol. 17(11), pages 1-28, November.

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    More about this item

    Keywords

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    JEL classification:

    • 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
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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