Do domestic firms benefit from geographic proximity with FDI? Evidence from the privatization of the Czech glass industry

Arbeitspapier

This paper analyzes the effects of geographical proximity and agglomeration of FDIs (foreign direct investments) on domestic firms in the privatized glass sector in the Czech Republic. The motivation for this research is based on the scant evidence in Central and Eastern Europe of the effects of geographical proximity and agglomeration on the productivity of domestic firms. This study aims to explain how spillovers are transferred from FDIs to domestic firms. The econometrical analysis, using original panel data from 1990 to 2006, provides evidence that the agglomeration of FDIs has a negative and significant effect on the productivity of domestic firms in the glass sector at a 5% level. The effect of geographical proximity to FDIs is significant at a 10% level but not in all models. The results support the importance of geographic proximity and agglomeration of FDIs and conform with the evidence that shows that FDIs have produced negative spillovers on domestic firms in transition countries.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IES Working Paper ; No. 20/2008

Classification and Topics

• Classification: Wirtschaft ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models ; International Investment; Long-term Capital Movements ; Multinational Firms; International Business ; Metals and Metal Products; Cement; Glass; Ceramics ; Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure ; Size and Spatial Distributions of Regional Economic Activity
• Subject: foreign direct investments ; agglomeration economies ; panel data ; regional location ; Czech Republic ; glass industry ; Direktinvestition ; Regionales Cluster ; Betrieblicher Standort ; Spillover-Effekt ; Produktivität ; Glasindustrie ; Panel ; Tschechische Republik

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Galeotti, Elisa
• Event: Veröffentlichung
• (who): Charles University in Prague, Institute of Economic Studies (IES)
• (where): Prague
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/83355
• Last update: 10.03.2025, 11:44 AM CET