Foreign Direct Investment, Backward Linkages, and Productivity Spillovers
Foreign Direct Investment, Backward Linkages, and Productivity Spillovers

Author: Wim Douw

Publisher:

Published: 2020

Total Pages:

ISBN-13:

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This note provides an up-to-date summary of the academic evidence around the drivers and channels for technology transfer and productivity spillovers by multinational corporations (MNC) operating in host economies. Foreign direct investment (FDI) is a major contributor to development. Besides the direct benefits FDI brings in terms of increased capital, employment and exports, the presence and operations of MNCs can also help improve the productivity of local firms through backward linkages and offer an important channel for the integration of local firms into global value chains (GVC). However, several market failures exist that get in the way of these linkages and spillovers fully materializing. This note highlights the main challenges as well as some policy recommendations for host economy Governments to consider.

Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages
Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages

Author: Beata Smarzynska Javorcik

Publisher:

Published: 2015

Total Pages: 0

ISBN-13:

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Many countries strive to attract foreign direct investment (FDI) hoping that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. In contrast with earlier literature that failed to find positive intraindustry spillovers from FDI, this study focuses on effects operating across industries. The analysis, based on firm-level data from Lithuania, produces evidence consistent with positive productivity spillovers from FDI taking place through contacts between foreign affiliates and their local suppliers in upstream sectors. The data indicate that spillovers are associated with projects with shared domestic and foreign ownership but not with fully owned foreign investments.

Are There Productivity Spillovers from Foreign Direct Investment in China?
Are There Productivity Spillovers from Foreign Direct Investment in China?

Author: Galina Hale

Publisher:

Published: 2014

Total Pages: 34

ISBN-13:

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We review previous literature on productivity spillovers of foreign direct investment (FDI) in China and conduct our own analysis using a firm-level data set from a World Bank survey. We find that the evidence of FDI spillovers on the productivity of Chinese domestic firms is mixed, with many positive results largely due to aggregation bias or failure to control for endogeneity of FDI. Attempting over 2500 specifications which take into account forward and backward linkages, we fail to find evidence of systematic positive productivity spillovers from FDI.

The Role of Exporting and Linkages for Productivity Spillovers from FDI.
The Role of Exporting and Linkages for Productivity Spillovers from FDI.

Author: Sourafel Girma

Publisher:

Published: 2015

Total Pages: 0

ISBN-13:

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In this paper we analyse productivity spillovers from foreign direct investment using firm level panel data UK manufacturing industries from 1992 to 1999. We investigate spillovers through horizontal, backward and forward linkages, distinguish spillovers from export oriented vs domestic market oriented FDI, and allow for differing effects depending on domestic firms' export activities. The results suggest that the mechanisms through which spillovers affect domestic firms are very complex and that there are substantial differences in spillover benefits for domestic exporters and non-exporters.

Foreign Direct Investment, China and the World Economy
Foreign Direct Investment, China and the World Economy

Author: P. Buckley

Publisher: Springer

Published: 2009-11-29

Total Pages: 438

ISBN-13: 0230248322

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China has become such an important element of the global economy that its influence cannot be ignored in almost any field of endeavour. The phenomenal impact of FDI in China and its (largely trade-related) consequences has been well documented and now there is a significant literature on the phenomenon of outward investment from China too. This book is an in depth study of the international business relationships of China covering both inward and outward foreign direct investment, its impact and related theoretical and policy issues. This volume of highly renowned author Peter Buckley's collected papers from 2005-8 continues his interest in the theory of international business (Section I) and policies towards foreign direct investment (FDI) (Section IV) but has a major concentration on China, both as regards outward foreign direct investment (OFDI) from China (Section II) and FDI in China (Section III).

Does Foreign Direct Investment Promote Development?
Does Foreign Direct Investment Promote Development?

Author: Theodore Moran

Publisher: Columbia University Press

Published: 2005-04-15

Total Pages: 427

ISBN-13: 0881324639

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What is the impact of foreign direct investment (FDI) on development? The answer is important for the lives of millions—if not billions—of workers, families, and communities in the developing world. The answer is crucial for policymakers in developing and developed countries, and in multilateral agencies. This volume gathers together the cutting edge of new research on FDI and host country economic performance and presents the most sophisticated critiques of current and past inquiries. It probes the limits of what can be determined from available evidence and from innovative investigative techniques. In addition, the book presents new results, concludes with an analysis of the implications for contemporary policy debates, and proposes new avenues for future research.