Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America

This paper investigates the role of structural reforms ñ privatization, financial reform and trade liberalizationñ as determinants of FDI inflows based on newly constructed dataset on structural reforms for 19 Latin American and 25 Eastern European countries between 1989 and 2004. Our main finding is a strong empirical relationship from reforms to FDI, in particular, from financial liberalization and privatization. These results are robust to different measures of reforms, split samples, and potential endogeneity and omitted variables biases.http://deepblue.lib.umich.edu/bitstream/2027.42/64417/1/wp906.pd

Foreign Direct Investment as Technology Transferred: Some Panel Evidence from the Transition Economies

Although the theoretical literature has identified various sizeable benefits from foreign direct investment inflows (FDI), the empirical literature has been unable to establish a positive and significant impact of FDI on the rates of economic growth of host countries. One reason for this difficulty is that theory equates FDI to technology transferred, while in most countries and regions of the world FDI encompasses an array of arrangements that goes well beyond pure technology transfer. This paper tests for the effects of FDI on growth in a set of countries in which FDI is purer technology transferred: the 25 Central and Eastern European and former Soviet Union transition countries between 1990 and 1998. Our main finding is that, in this more appropriate setting, FDI has a positive and significant impact on economic growth as theory predicts.http://deepblue.lib.umich.edu/bitstream/2027.42/39822/3/wp438.pd

WHY DOES FDI GO WHERE IT GOES? NEW EVIDENCE FROM THE TRANSITION ECONOMIES

This paper examines the importance of agglomeration economies and institutions vis-à-vis initial conditions and factor endowments in explaining the locational choice of foreign investors. Using a unique panel data set for 25 transition economies between 1990 and 1998, we find that the main determinants are institutions, agglomeration and trade openness. We find important differences between the Eastern European and Baltic countries, on the one hand, and the former Soviet Union countries on the other: in the latter group, natural resources and infrastructure matter, while agglomeration matters only for the former group.http://deepblue.lib.umich.edu/bitstream/2027.42/39959/3/wp573.pd

WHY DOES FDI GO WHERE IT GOES? NEW EVIDENCE FROM THE TRANSITION ECONOMIES

This paper examines the importance of agglomeration economies and institutions vis-à-vis initial conditions and factor endowments in explaining the locational choice of foreign investors. Using a unique panel data set for 25 transition economies between 1990 and 1998, we find that the main determinants are institutions, agglomeration and trade openness. We find important differences between the Eastern European and Baltic countries, on the one hand, and the former Soviet Union countries on the other: in the latter group, natural resources and infrastructure matter, while agglomeration matters only for the former group.foreign direct investment, transition economies

Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America

This paper investigates the role of structural reforms – privatization, financial reform and trade liberalization – as determinants of FDI inflows based on newly constructed dataset on structural reforms for 19 Latin American and 25 Eastern European countries between 1989 and 2004. Our main finding is a strong empirical relationship from reforms to FDI, in particular, from financial liberalization and privatization. These results are robust to different measures of reforms, split samples, and potential endogeneity and omitted variables biases.privatization, financial reform, trade liberalization, foreign direct investment, Latin America, transition economies

Estimating the Determinants of Foreign Direct Investment Inflows: How Important are Sampling and Omitted Variable Biases?

This paper investigates the importance of factor endowment vis-à-vis institutions in explaining the locational choice of foreign investors during the 1990s. Using dynamic panel estimation on data for transition economies, we find that low labour costs, bureaucratic efficiency (“institutions”), agglomeration economies and natural resource abundance are key factors explaining foreign investors’ decisions. However, sampling proves fundamental as these overall determinants mask deep and, so far empirically unexplored, differences between groups of recipient countries. For example, for the former Soviet Union economies we estimate that labour costs are no longer crucial, but abundance of natural resources and (interestingly) lower levels of human capital are. For Eastern Europe, we find that external liberalisation (one aspect of economic reform) is crucial in foreign investor’s decisions. The main message is that minimising sampling biases and accounting for previously omitted variables yields a different, much richer picture than previously available.foreign direct investment; dynamic panel estimation; transition economies

Foreign Direct Investment as Technology Transferred: Some Panel Evidence from the Transition Economies

Although the theoretical literature has identified various sizeable benefits from foreign direct investment inflows (FDI), the empirical literature has been unable to establish a positive and significant impact of FDI on the rates of economic growth of host countries. One reason for this difficulty is that theory equates FDI to technology transferred, while in most countries and regions of the world FDI encompasses an array of arrangements that goes well beyond pure technology transfer. This paper tests for the effects of FDI on growth in a set of countries in which FDI is purer technology transferred: the 25 Central and Eastern European and former Soviet Union transition countries between 1990 and 1998. Our main finding is that, in this more appropriate setting, FDI has a positive and significant impact on economic growth as theory predicts.Foreign Direct Investment, economic growth, transition economy

On the Hadronic Contribution to Light-by-light Scattering in gμ−2g_\mu-2

We comment on the theoretical uncertainties involved in estimating the hadronic effects on the light-by-light scattering contribution to the anomalous magnetic moment of the muon, especially based on the analysis and results of T. Kinoshita, B. Ni\v zi\'c, and Y. Okamoto, Phys.\ Rev.\ D31, 2108 (1985). From the point of view of an effective field theory and chiral perturbation theory, we suggest that the charged pion contribution may be better determined than has been appreciated. However, the neutral pion contribution needs greater theoretical insight before its magnitude can be reliably estimated.Comment: 9 pages, no figures, U. Michigan UM-TH-93-18. (Input phyzzm to compile.) Revised version has minor changes in text. To be published in Phys. Rev. D, Comments sectio