Quantifying productivity gains from foreign investment Fons-Rosen, Christian; Kalemli-Ozcan, Sebnem; Sørensen, Bent E. ...
Journal of international economics,
July 2021, 2021-07-00, 20210701, Volume:
131
Journal Article
Peer reviewed
Open access
We revisit the relationship between foreign investment and productivity of acquired firms. First, we construct a panel firm-level dataset for eight advanced European countries covering domestic and ...foreign acquisitions together with detailed balance sheet information for the years 1999–2012. Second, we address the challenge of identifying a causal relation. To that end, we compare foreign to domestic acquisitions in addition to accounting for the impact of majority versus minority acquisitions after controlling for country and sector trends. The productivity of foreign acquired affiliates increases modestly after four years, but only when majority stakes are acquired by foreigners. Our results are driven by foreign acquisitions and not by foreign divestment.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
This Article applies the theory of comparative institutional analysis to evaluate the trade-offs associated with alternative mechanisms for resolving investment disputes. We assess the trade-offs in ...light of the principle of accountability under the rule of law, which underpins the goals of fairness, efficiency, and peace that are attributed to investment law. The Article makes two recommendations: first, reforms should address complementarity between domestic and international institutions; second, institutional choices should respond to the different contexts that states face.
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BFBNIB, INZLJ, NMLJ, NUK, ODKLJ, PNG, PRFLJ, SAZU, UL, UM, UPUK, ZRSKP
Regional trade agreements are major international policy instruments that shape macro-economic and political systems. There is widespread debate as to whether and how these agreements pose risks to ...public health. Here we perform a comprehensive systematic review of quantitative studies of the health impact of trade and investment agreements. We identified studies from searches in PubMed, Web of Science, EMBASE, and Global Health Online. Research articles were eligible for inclusion if they were quantitative studies of the health impacts of trade and investment agreements or policy. We systematically reviewed study findings, evaluated quality using the Quality Assessment Tool from the Effective Public Health Practice Project, and performed network citation analysis to study disciplinary siloes.
Seventeen quantitative studies met our inclusion criteria. There was consistent evidence that implementing trade agreements was associated with increased consumption of processed foods and sugar-sweetened beverages. Granting import licenses for patented drugs was associated with increased access to pharmaceuticals. Implementing trade agreements and associated policies was also correlated with higher cardiovascular disease incidence and higher Body Mass Index (BMI), whilst correlations with tobacco consumption, under-five mortality, maternal mortality, and life expectancy were inconclusive. Overall, the quality of studies is weak or moderately weak, and co-citation analysis revealed a relative isolation of public health from economics.
We identified limitations in existing studies which preclude definitive conclusions of the health impacts of regional trade and investment agreements. Few address unobserved confounding, and many possible consequences and mechanisms linking trade and investment agreements to health remain poorly understood. Results from our co-citation analysis suggest scope for greater interdisciplinary collaboration. Notwithstanding these limitations, our results find evidence that trade agreements pose some significant health risks. Health protections in trade and investment treaties may mitigate these impacts.
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IZUM, KILJ, NUK, PILJ, PNG, SAZU, UL, UM, UPUK
ABSTRACT
We develop a theory that links the U.S. dollar's valuation in FX markets to the convenience yield that foreign investors derive from holding U.S. safe assets. We show that this convenience ...yield can be inferred from the Treasury basis, the yield gap between U.S. government and currency‐hedged foreign government bonds. Consistent with the theory, a widening of the basis coincides with an immediate appreciation and a subsequent depreciation of the dollar. Our results lend empirical support to models that impute a special role to the United States as the world's provider of safe assets and the dollar as the world's reserve currency.
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BFBNIB, FZAB, GIS, IJS, KILJ, NLZOH, NUK, OILJ, SBCE, SBMB, UL, UM, UPUK
This paper examines the interrelationships between energy consumption, foreign direct investment and economic growth using dynamic panel data models in simultaneous-equations for a global panel ...consisting of 65 countries. The time component of our dataset is 1990–2011 inclusive. To make the panel data analysis more homogenous, we also investigate this interrelationship for a number of sub-panels which are constructed based on the income level of countries. In this way, we end up with three income panels; namely, high income, middle income, and low income panels. In the empirical part, we draw on the growth theory and augment the classical growth model, which consists of capital stock, labor force and inflation, with foreign direct investment and energy. Generally, we show mixed results about the interrelationship between energy consumption, FDI and economic growth.
•We examine the energy–FDI–growth nexus for a global panel of 65 countries.•Dynamic simultaneous-equation panel data models are used to address this issue.•We also investigate this nexus for three sub-panels which are constructed based on the income level of countries.•We show mixed results about the interrelationship between the three variables.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
This paper uses a Directional Distance Function (DDF) and the Malmquist–Luenberger Productivity Index to estimate the changing patterns of ‘green’ total factor productivity (GTFP) growth of 38 ...Chinese industrial sectors during the period 1980–2010. Unlike the measures of traditional total factor productivity (TFP) growth, the DDF incorporates carbon dioxide emissions as an undesirable output directly into the production technology, which credit sectors for simultaneously reducing their emissions and increasing their output. Our estimates of aggregate and sector-level GTFP growth reveal that Chinese industry is not yet on the path towards sustainable, low-carbon growth. A dynamic panel data analysis of the determinants of GTFP across sectors is used to identify factors that might rectify this situation, including state owned enterprise (SOE) reform, the growth of small private enterprises, continued openness to foreign investment and higher spending on R&D, particularly in emission-intensive sectors.
•We estimate the ‘green’ productivity growth of 38 industries in China, 1980–2010.•We show that Chinese industry is not on the path to sustainable low-carbon growth.•We identify the determinants of GTFP growth using dynamic panel data analysis.•We consider policy implications in the context of China's current reform agenda.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
The paper studies the correlation between the FDI and the GDP in the EU15 member states, between 1980 and 2014. The FDI was set as an independent variable, and the GDP as a dependent variable. The ...aim of the paper is to study the correlation between the FDI and the GDP in the states that founded the EU (then the EEC) or joined the EEC/EU up to 1996. The following research hypotheses were set: no. 1, stating that the FDI and the GDP in the EU15 member states show a significant correlation, and research hypothesis no. 2, claiming that EU15 member states of "the EU15 economic periphery" show a higher correlation than the EU15 member states of "the EU15 economic core". The NULL hypothesis, which claims that the FDI and the GDP in EU15 member states do not show a significant correlation, was also set. The Pearson correlation coefficient values verified the research hypotheses for most of the studied states.
In Imperfect Alternatives: Institutional Choice and the Reform of Investment Law, Sergio Puig and Gregory Shaffer introduce comparative institutional analysis to evaluate alternative processes for ...resolving investment disputes. The impetus for this article is clear: many states view investor-state arbitration as akin to a horse that has bolted from the barn. Wishing to close the stable door, a wide range of states are considering the merits of various reform proposals. Puig and Shaffer's comprehensive and balanced framework for assessing the tradeoffs involved in making different choices is thus a welcome and timely intervention in these (often highly polarized) debates.
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BFBNIB, INZLJ, NMLJ, NUK, ODKLJ, PNG, PRFLJ, SAZU, UL, UM, UPUK, ZRSKP
The paper investigates the contributions of foreign direct investment (FDI) net inflows to clean energy use, carbon emissions, and economic growth. The paper employs cointegration tests to examine a ...long-run equilibrium relationship among the variables and fixed effects models to examine the magnitude of FDI contributions to the other variables. The paper analyzes panel data of 19 nations of the G20 from 1971 to 2009. The test results indicate that FDI has played an important role in economic growth for the G20 whereas it limits its impact on an increase in CO2 emissions in the economies. The research finds no compelling evidence of FDI link with clean energy use. Given the results, the paper discusses FDI's potential role in achieving green growth goals.
► FDI inflows strongly lead to economic growth in the G20. ► FDI inflows lead to an increase in energy use in the G20. ► FDI inflows are in no relation to CO2 emissions in the G20. ► FDI inflows are in no relation to clean energy use in the G20. ► Economic growth is in negative relation to CO2 emissions in the G20.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
Access to energy is recognised to be at the heart of human development. However, there is a paucity of empirical research on the impact of access to energy on human development, particularly in ...energy-poor countries. This study, therefore, examines the effect of access to electricity and clean energy on human development in 79 energy-poor countries from South Asia, sub-Saharan Africa, and Caribbean-Latin America for the period 1990–2018. Using the Lewbel two-stage least squares approach to control for endogeneity, our study reveals that access to both electricity and clean energy improve human development in the aggregated sample. Comparatively, our results also suggest that while access to both electricity and clean energy enhance human development in Caribbean-Latin America and sub-Saharan Africa, they worsen human development in South Asia. Generally, our results indicate that economic growth, trade openness, foreign direct investment, urbanisation, access to credit and remittance enhance human development. This study also indicates that employment, industrialisation, economic growth, ICT, and gender empowerment are some of the important channels through which energy accessibility influence human development. The comparative effect of access to electricity, clean energy, and the control variables on different facets of human development such as education (human capital) and health (life expectancy, maternal mortality, and under-five mortality) are presented. In this study, we conclude that access to energy is crucial for human development but does not equally benefit all the components of human development.
•Examines the effect of energy accessibility on human development in energy-poor regions.•Energy accessibility improves human development in sub-Saharan Africa and Caribbean-Latin America.•Energy accessibility worsens human development in South Asia.•Energy accessibility moderates the impact of economic growth to influence human development.•Energy accessibility does not equally benefit all the components of human development.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
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