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Foreign direct investment spillovers within and between sectors: Evidence from Hungarian data

Author

Listed:
  • K. SCHOORS
  • B. VAN DER TOL

Abstract

This article analyses how FDI influences labour productivity of domestic firms in Hungary. We find that foreign firms perform better than local firms. The presence of foreign firms has a positive spillover effect on labour productivity of local firms in the same sector, specifically in very open manufacturing sectors. Spillover effects between sectors are found to be relatively more important than spillover effects within sectors. Foreign investment in user sectors has a positive spillover effect on local suppliers, while the opposite holds for foreign investment in supplier sectors. Absorption and openness play a significant role in these spillover effects.

Suggested Citation

  • K. Schoors & B. Van Der Tol, 2002. "Foreign direct investment spillovers within and between sectors: Evidence from Hungarian data," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 02/157, Ghent University, Faculty of Economics and Business Administration.
    • Handle: RePEc:rug:rugwps:02/157
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    File URL: http://wps-feb.ugent.be/Papers/wp_02_157.pdf
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    More about this item

    Keywords

    Foreign direct investment; sectoral spillover; intersectoral spillover;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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