Examining the relationship between the exchange rate, foreign direct investment and trade

Extensive research has been carried out on the relationships among foreign direct investment (FDI), exports, the exchange rate, and economic growth. However, these research findings are mixed and inconclusive. Therefore, further research and discussion are needed on this topic. This study focused on Mexico, since it is one of the major FDI recipient countries in Latin America and much of its trade is a result of its free trade agreements. This study examines the relationship between FDI, exports, and economic growth in the context of FDI from developed to developing countries (Mexico). The second chapter analyzes the relationship of FDI with the level of the exchange rate, exchange rate volatility, and exchange rate expectations during the period from 1994 to 2008. The analysis revealed a significant impact of level of exchange rates and exchange rate expectations on FDI flows. Regional trade agreements, such as the European Union (EU) and the North American Free Trade Agreement (NAFTA), were important factors to attract FDI. The third chapter examines the long-run relationship between U.S. FDI and U.S exports to Mexico from 1988Q1 to 2008Q4. This analysis found a complementary (positive) relationship between FDI and exports. However, the strength of the relationship differs with different types of FDI. The analysis further revealed a weak complementary relationship with exports of processed food and a strong positive relationship with manufacturing exports. The study also showed a significant impact of NAFTA on manufacturing and total FDI and an insignificant impact on processed food FDI. Chapter four examined Granger causality among GDP, exports, and FDI in Mexico for the period of 1970 to 2008. The causality was tested from the bivariate to the multivariate framework using Toda and Yamamoto (1995) and Doland and Lutkepohl (1996) (TYDL) methodologies. An important finding in this study is the Ganger causality from gross fixed capital formation and labor force to imports. The results suggest that the Granger causality between GDP and exports; FDI and GDP; exports and FDI observed in two, three or four variable frameworks are through a channel of imports

The Exchange Rate and Inward Foreign Direct Investment in Mexico

This paper analyzed the exchange rate and inward foreign direct investment (FDI) in Mexico from the 25 developed countries comprising the Organization for Economic Co-operation and Development (OECD). Our empirical result does not support the significant relationship between exchange rate and exchange rate volatility to determine FDI in Mexico. The wages, export, and distance are found to be significant variables to determine FDI in Mexico which is supported by literatures.Exchange rate, Foreign direct investment, Mexico, OECD, International Relations/Trade,

BROILER PRODUCERS’ WILLINGNESS TO PAY TO MANAGE NUTRIENT POLLUTION

Economic incentives or disincentives play a major role on encouraging producers to implement environmentally benign production practices. We evaluated producers’ willingness to pay (WTP) value to represent the level of disincentives that motivate farmers to mitigate nutrient pollution. The result obtained by using ordered response model showed that farm size, farm income, and land available to spread litter are major variables that determine the producers’ WTP.Environmental Economics and Policy,

The Exchange Rate and Inward Foreign Direct Investment in Mexico

This paper analyzed the exchange rate and inward foreign direct investment (FDI) in Mexico from the 25 developed countries comprising the Organization for Economic Co-operation and Development (OECD). Our empirical result does not support the significant relationship between exchange rate and exchange rate volatility to determine FDI in Mexico. The wages, export, and distance are found to be significant variables to determine FDI in Mexico which is supported by literatures

BROILER PRODUCERS’ WILLINGNESS TO PAY TO MANAGE NUTRIENT POLLUTION

Economic incentives or disincentives play a major role on encouraging producers to implement environmentally benign production practices. We evaluated producers’ willingness to pay (WTP) value to represent the level of disincentives that motivate farmers to mitigate nutrient pollution. The result obtained by using ordered response model showed that farm size, farm income, and land available to spread litter are major variables that determine the producers’ WTP