15 research outputs found
What Explains Intra-Asian FDI Flows?: Do Distance and Trade Matter?
This paper examines intra-Asian FDI flows using bilateral data over the period 1990 to 2005. Does the so-called distance puzzle that has charcterized trade and FDI based gravity models exist in the case of intra-Asian FDI flows as well? And if so, to what extent can it be explained by informational assymetries and international trade as opposed to physical distance? These questions are explored in this paper.
Sources of FDI flows to developing Asia: The roles of distance and time zones
This paper investigates sources and determinants of foreign direct investment (FDI) flows to developing Asia using bilateral FDI flows for the period 1990-2005. The Triad (composed of Japan, EU, and the US) has accounted for about 35-40% of FDI inflows to developing Asia in recent years, with Japan being the single largest investor. Intra-developing Asian flows have also accounted for about 35% of total inflows to the region, and these shares have remained fairly stable for the period 1997-2004. With regard to the determinants of FDI flows, the paper finds that an augmented gravity model fits the data fairly well. We pay particular attention to possible differences in the determinants of FDI flows to developing Asian economies from the rest of the Asia and Pacific region, compared to those from nonregional OECD economies, with an emphasis on the roles of distance and time zone differences. To preview the main conclusion, we find that the elasticity of distance is greater for FDI from the non-Asia Pacific OECD economies than intraregional Asian flows. However, this difference disappears when one accounts for differences in time zones
Comments on Korea's outward FDI in Asia : characteristics and prospects
PowerPoint presentationLarge enterprises consistently led Korea’s Foreign Direct Investment (FDI) outflow in most industries. Small and medium enterprises (SMEs) and individuals come second and third, respectively. This brief presentation explains the push and pull factors of Korea’s outward FDI to the world and to other Asian countries. Table 6 provides “Basic Facts about the outward FDI stock of Selected Asian Economies” (along with named top 5 recipients and industries)
Intra-Asian FDI flows : trends, patterns and determinants
PowerPoint presentationThe presentation introduces characteristics of foreign direct investment (FDI). Hong Kong’s outflows are far higher than any other developing economy. Most direct investment activities are between East Asian countries. Tables of Intra-Asian FDI and FDI flows show periods of economic liberalization characterized by simultaneous rises in both FDI inflows as well as outflows. A mathematical model is utilized where variables refer to market size, growth, exchange rates, and institutional type. The model data uses country pairs to reflect on intra-country investments
Economic growth and structural change in South Asia: miracle or mirage?
This monograph has been prepared by Dr Ijaz Nabi with assistance from Abdul Malik, Rabin Hattari (World Bank), Turab Husain, Adeel Shafqat, Sana Anwaar, and Ammar Rashid (Lahore University of Management Sciences)
Asian-Pacific Economic Literature
Unlike trade flows, there has been little to no detailed examination of foreign direct investment (FDI) flows between Asian economies. This paper uses bilateral FDI flows data to investigate trends in intra-Asian FDI flows over the period 1990-2005. It employs an augmented gravity model to identify the main determinants of intra-Asian FDI flows. Possible drivers of FDI flows, including transactional and informational distance (proxied by distance), real sector variables, financial variables, and quality of institutions are examined
Understanding bilateral FDI flows in developing Asia
Unlike trade flows, there has been little to no detailed examination of foreign direct investment (FDI) flows between Asian economies. This paper uses bilateral FDI flows data to investigate trends in intra-Asian FDI flows over the period 1990-2005. It employs an augmented gravity model to identify the main determinants of intra-Asian FDI flows. Possible drivers of FDI flows, including transactional and informational distance (proxied by distance), real sector variables, financial variables and quality of institutions are examined. Copyright © 2009 The Authors. Journal compilation © 2009 Crawford School of Economics and Government, The Australian National University and Blackwell Publishing Asia Pty Ltd..
How Different are FDI and FPI Flows?: Does Distance Alter the Composition of Capital Flows?
The availability of bilateral capital flows between countries has given rise to a number of papers attempting to understand trends and determinants of capital flows between country pairs. Almost without exception, the papers find that the gravity model fits the data quite well. Specifically, while economic sizes of the host and source (measured by GDP, population etc) appear to positively impact bilateral flows in most cases, distance -- broadly proxying some sort of transactions and / or information frictions -- stands out as consistently hindering all types of capital flows. But does greater distance hinder both foreign portfolio investment (FPI) and foreign direct investment (FDI) flows equally? In other words, does distance change the composition of capital flows? This is the specific question that this paper focuses on, differentiating between total FDI, FDI via mergers and acquisitions (M&As) and FPI.Distance, Foreign Direct Investment (FDI), Foreign Portfolio Investment (FPI), Gravity, Mergers and Acquisitions (M&As)
Trends and Drivers of Bilateral FDI Flows in Developing Asia
Developing countries are rapidly emerging as new and important sources of foreign direct investment (FDI) to other developing countries. While Asian companies have become significant foreign direct investors abroad, a large share of outward investments from Asia appears to have been recycled intraregionally. However, unlike trade flows, there has been little to no detailed examination of FDI flows between Asian economies at a bilateral level. This paper uses bilateral FDI flows data to investigate trends and patterns of intra-Asian FDI flows over the period 1990 to 2005. It also employs an augmented gravity model framework to examine the main determinants of intra-Asian FDI flows. A range of drivers of FDI flows, including transactional and informational distance (proxied by distance), real sector variables, financial variables and institutional quality are examined.Developing Asia, Distance, Foreign direct investment (FDI), Institutions, Intra-regional, Gravity model
India as a Source of Outward Foreign Direct Investment
While India is an increasingly attractive destination for foreign capital, the country is also becoming a significant source of outflows. Many Indian enterprises view outward foreign direct investment (OFDI) as an important dimension of their corporate strategies. This paper presents some data on the magnitude and composition of Indian OFDI. It also discusses the rationale for and empirical determinants of overseas acquisitions by Indian companies. The empirical findings suggest that OFDI from India is not entirely different from that of other countries in that they are motivated by many common factors. There is evidence, however, that Indian OFDI is more market- and resource-seeking than OFDI from most other countries. The paper concludes with a broader discussion of the impact of the global rise of Indian companies on the Indian economy.