Impacts of Inward FDI on Outward FDI:Evidence from Global Panel Data
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| Title | Impacts of Inward FDI on Outward FDI:Evidence from Global Panel Data
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| Author | Pan Wenqing, Chen Xiao, Chen Taotao and Gu Lingjun |
| Organization | School of Economics and Management, Tsinghua University |
| Email | panwq@sem.tsinghua.edu.cn；chenx3.07@sem.tsinghua.edu.cn；chentt@sem.tsinghua.edu.cn；gulj.13@sem.tsinghua.edu.cn |
| Key Words | Outward Foreign Direct Investment; Inward Foreign Direct Investment; Characteristics of Host Country; IDP |
| Abstract | Based on the theory of IDP, we employed the global panel data of 146 countries from 1980 to 2011 to investigate the impacts of inward FDI (IFDI) on outward FDI (OFDI) and its mechanism. Our results show that: the global data in general shows a significant positive impact of IFDI on OFDI; and this effect is closely related with the characteristics of the host country: IFDI will further promote OFDI if the host country has higher FDI absorptive capability and larger market size. In addition, we find that the impact of host country’s economic development on OFDI is also to a greater extent through its direct impact on IFDI which in turn improve the capability of OFDI, and this mechanism is robust. |
| Serial Number | WP611 |
| Time | 2014-08-05 |
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