Policies to attract Foreign Direct Investment: An industry-level analysis

Bericht

This paper analyzes policies to attract Foreign Direct Investment (FDI) based on a sample comprising the US plus six EU countries (US-plus-EU-6) and four Central and Eastern European Countries (CEEC-4). The analysis draws on industry-level data for 1995-2003. A Dynamic Panel Data approach is used to isolate important country- and industry-level determinants of FDI inward stock. The estimated baseline model derived is used to assess the scope for FDI attraction policies. The scope for FDI is defined as the difference between the FDI inward stock received by a country-industry-pair, as implied by the baseline model ("estimated FDI"), and the inward FDI stock which could be realized if a certain "best practice" policy were carried out ("potential" FDI). The results show how different policy variables contribute to closing the gap between estimated and potential FDI. The countries in our sample fall into two groups: In the CEEC-4 an increase of R&D expenditures in GDP would result in a substantial increase in FDI, while in the US-plus-EU-6 an improvement of their unit labor cost position, e.g. via increases in labor productivity, and improvements in their tax position would attract additional FDI.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: FIW-Research Reports ; No. 019

Klassifikation und Themen

• Klassifikation: Wirtschaft ; International Investment; Long-term Capital Movements ; Business Taxes and Subsidies including sales and value-added (VAT) ; State and Local Taxation, Subsidies, and Revenue
• Thema: Economic Policy ; Foreign Direct Investment ; European Union ; Industry-level Study ; Location Decision

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Bellac, C. ; Leibrecht, M. ; Stehrer, Robert
• Ereignis: Veröffentlichung
• (wer): FIW - Research Centre International Economics
• (wo): Vienna
• (wann): 2008

Weitere Informationen

• Handle: http://hdl.handle.net/10419/121201
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ