Foreign direct investment (FDI) is being widely considered as an important vehicle for economic growth in least developed countries (LDCs). Egypt is a particularly interesting case to examine for a number of reasons. First, the recent increase in the inflow of FDI in Egypt, although important in itself, is still lower than what is expected. Second, the role of FDI in promoting output and the direction of causation is still unknown as little empirical research has been conducted in this field for Egypt. Most empirical studies of foreign direct investment (FDI) typically use either a cross- sectional or time series approach. The originality of the study is in the empirical investigation of these issues on the basis of a broad panel of sectoral data for Egypt. This thesis attempts to explore the determinants of MI at the sectoral level in the Egyptian economy by using a panel data of 10 sectors over the period from 1983 to 2004. The results highlight that private domestic investment, openness' to trade, and government policies towards reforming and improving business and investment climate are important determinants of sectoral FDI in Egypt. Second, it attempts to fill the empirical gap in the literature by re-examining the impact of FDI on productivity for a cross sectional sample of the Egyptian manufacturing sector from 1975 to 2005. The results reveal that foreign direct investment inflows exert a positive spillover effect on productivity. Finally, it aims to study the causal link between FDI and GDP by using a time series data from 1978 to 2009. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between FDI and GDP. It is evident that in the long run there is a bidirectional relation, while in the short run, causality runs from FDI to GDP.

The last two decades have witnessed a noticeable rise in Chinese outward foreign direct investment (FDI), which has attracted the interest of scholars from multiple business perspectives. This research focuses on two research areas of Chinese outward FOI, and its objectives are to empirically identify the determinants of the establishment mode of FDI entries and the subsidiary strategy in tern1.'> of global integration and local responsiveness. To fulfil these objectives, J developed conceptual frameworks for I) entry choice between greenfield and acquisition, 2) subsidiary's global integration, and 3) subsidiary's responsiveness, and empirically tested these frameworks with a quantitative research method. This is done using primary data collected from companies' annual reports and relevant documents, a questionnaire survey, and multiple secondary data published by international organisations. In terms of empirical findings, this research suggests that the mainstream FDI theory, the FSA/CSA framework in particular, is capable of explaining FDJ from emerging markets and MNEs' internationalisation activities. Firstly, this research finds that Chinese MNEs do possess a certain degree of FSAs that can be internalised through a greenfield entry, while host country local resources exert significant influence on Chinese films' establishment mode decision. In addition, the importance of home country institution as a driver for firm strategic decision is confirmed in the case of Chinese outward FOI. Secondly, the extended FSA/CSA framework sheds light on the subsidiary strategy in economic integration and local responsiveness. This study finds that the subsidiary's global integration is a function of non-location-bound (NLB) FSAs of Chinese firms, while location-bound (LB) FSAs encourage a subsidiary's local responsiveness. In addition, host country CSAs in trade openness is positivel'y related to the integration, and environment complexity leads to responsive strategy

This thesis develops a theoretical framework, empirically tests cross-sector FDI spillovers, and explores the mechanisms underpinning externalities. Using a combination of firm-level panel datasets of 1,000 UKfirms and industry-level data of inward FDI into the UK, itfinds that there exist positive cross-sector FDI spillovers (i.e. between manufacturing and service industries) and negative intra- and inter-industry externalities. The scale and scope of such spillovers depend on firm idiosyncrasies and exogenous factors of the industry in which local and foreign firms interact. J' Overall, this study finds strong evidence to support the notion that FDI spillovers do exist. However, the findings contradict the majority of conventional beliefs, which state that FDI would bring benefit to local businesses. Rather, this thesis shows that FDI spillovers are a multi- dimensional phenomenon: while intra- and inter-industry spillovers are negative, indigenous firms enjoy positive externalities arising from the interaction between manufacturing and services. The positive or negative outcomes of FDI spillovers, as theory predicts, can be explained by a number of firm-specific and exogenous factors. These act as moderators, influencing the relationship between local firm performance and spillovers. The thesis offers two main contributions to the IB literature on FDI spillovers. First, it extends prior work by exploring, theoretically and empirically, the inter-connection between manufacturing and services in explaining cross-sector FDI spillovers. It adds to the current literature by capturing more fully the theory and Impacts of foreign direct investment in the host country, enabling us to connect scattered research on manufacturing and services. Second, this thesis explains the mechanisms under which FDI spillovers take place by incorporating firm-specific idiosyncrasies and exogenous factors as moderators. We find that the root of the problem of the previous mixed empirical results is the pervasiveness of various moderators of firm attributes, and external factors that influence the performance-spillovers relationship. Firms are not passive recipients of external knowledge but are competent learning organisations characterised by the heterogeneity of resource profiles. Thus, local firms are not equally impacted by the presence of foreign firms. Some firms are able to benefit, some are impaired, while others might not be influenced at all. The extent to which foreign firms affect local firm performance depends not only on the characteristics of local firms themselves but also on the industry that they operate in.

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This dissertation explores the relationship and the determinants of FDI, trade and migration in three empirical studies. The first study estimate the Knowledge Capital model (KK) to explore the determinants and types of FDI in a small developing country, Pakistan. The results indicate that the model fits the data at aggregate and manufacturing sector reasonably well as signs on most of the explanatory variables related to the vertical and horizontal FDI are in line with the predictions of the model. However, there is strong evidence of vertical FDI as the endowment difference variable is positive and significant in most of the specifications suggesting that large countries invest to have factor cost advantage in Pakistan. We also modify the model by using dummy variables for the reform and period of instability. The results provide evidence that liberalization of trade and investment has positive effects on the inflows of both types of FDI and that political and economic instabilities negatively affect FDI inflows. The second essay explores the role of Pakistani migrants in facilitating FDI inflows by reducing informal barriers of trade and investment. In an augmented gravity model based on the new trade theory of the multinational we find significant positive impacts of migrants on FDI inflows in Pakistan both at the aggregate and sectoral levels. We also find that Pakistani immigrants in distant countries are more effective in reducing transaction costs. Among the Commonwealth countries, Pakistani immigrants in the UK have a significant positive impact on FDI inflows in Pakistan. Finally, this study finds that immigrants are effective in promoting FDI from both developed and developing countries, the effects being larger for immigrants in the former. In the third study we estimate the determinants of migration from Pakistan. The unique feature of this research is that we study migration in both OECD and non-OECD countries which is particularly relevant in the case of Pakistan as large number of migrants go to the Middle East countries. Using a modified gravity model, we explain the emigration rate from Pakistan by the income, population density, dependency rate and tertiary rate of education in the host countries. The findings of this study suggest that income in the host country is an important determinant of migration from Pakistan and that high population density and an increase in the rate of tertiary education in the host country discourage migration. The main objective of this study is to look at the impact of previous migrant stock on potential emigration rate from Pakistan. The positive and significant coefficients on lagged migration stock for both OECD and the Middle East countries support the view of the network theory that family and friends who have migrated previously help in migration of potential migrants by providing information and reducing logistics and other costs of migration.

During the past three decades policy makers from a number of developing countries have undertaken outward-oriented economic reforms with the objective of stimulating global capabilities and allowing domestic firms to catch up with the technological frontier. In the case of India, one of the most important features of such economic reforms has been the promotion of exports and outward foreign direct investments (FDI). Using a rich set of econometric methodologies, we examine the forces underlying Indian firms’ global strategies in the form of exporting and investing abroad and the impact of such decisions upon their future performance. Our analysis covers the years from 1999 to 2007, a period of gradual internationalization of Indian firms in response to ongoing trade and FDI liberalization. We contrast the strategies followed by manufacturing and service firms and pay particular attention to the role of technological and financial factors in shaping firms’ globalization processes. The first chapter of this thesis starts with an analysis of the individual and complementary effects of exporting and investing abroad in stimulating the development of firms’ in-house technological capabilities. We find that outward FDI substitutes the rate of technology investments at home, a result that is consistent with the notion of technology-seeking Indian multinationals investing abroad with the purpose of acquiring foreign technology. In contrast, we uncover evidence of technology-enhancing effects from exporting amongst Indian multinationals, indicating that exporting has been an important channel through which Indian multinational expansion has encouraged greater domestic economic activity. Finally, we fail to find evidence that exporting non multinational firms always invest more in technology than non-exporting ones. Rather, the nature of this association varies according to the sector under consideration and the type of technology. In the second chapter we analyze the process of productivity growth in Indian firms. We examine the individual and complementary roles of technology investments and international activities in stimulating innovation and technological convergence, two potential sources of firms’ productivity growth. Our findings indicate that technological convergence has been an important source of productivity growth in India, with service firms converging faster to the technological frontier than manufacturing companies. We also find that exporting boosts the rate of innovation of Indian multinationals, whereas their overseas investments speed up their rate of technological convergence. In the case of non-multinational companies, exporting stimulates productivity growth by accelerating their rate of technological transfer. There are also positive complementary effects between international activities and technology investments in stimulating firms’ productivity growth either through innovation and/or through technological transfer. Finally, in the third chapter we evaluate the role of external finance for service exports. In contrast to some findings for the manufacturing sector, we find that external finance is not a significant determinant of Indian service firms’ exporting activity.  .

In the face of tightened loans from commercial banks, skyrocketing interest rates, reduced export demand, and weak domestic industries, the countries of the Andean Community (Ancom) turned their eyes, in the early 1990s, to the promise of FOI. Paradoxically, despite the success of the incentives put in place to attract FOI, Ancom failed to attract the sought after technology flows that would assist them in diversifying their exports, strengthening their industry, and retaining a higher portion of the value-added activities in the production chain. FOI was mainly directed to economic sectors entailing enclave-type activities with weak linkages to the rest of the economy as well as often low levels of local processing of resources, unstable international prices, low tax income for non-renewable resources, and environmental contamination. The aim of this thesis is to investigate, first, what are the historical sector-level FOI patterns of inward FOI in Ancom; and second, what are their determinants. In particular, we explore the role that local political and civil institutions play in determining inward FOI, and whether this role varies from one sector to another. We present a newly compiled dataset of inward FDI stocks, disaggregated by eight welldefined economic sectors within each country. The contributions of this dataset are, first, unprecedented time coverage, extending for an entire extra decade, the 1980s, for the countries of Colombia and Peru, for every disaggregated economic sector; second, the presentation of previously unpublished FDI stock data for the Colombian oil and petroleum sector; and third, the reorganisation of the existing individual country datasets into a comprehensive regional dataset. The outcome is the creation of the strongest available statistical foundation, based on published as well as unpublished figures from official sources. From an econometric perspective our analysis uses techniques that allow exploring nonstationary processes such as the analysis of stochastic and time trends, cointegration, and vector-error-correction models. Key findings include the importance of the quality of the institutional quality of a country in determining the industrial structure of inward FOI. Furthermore, we find that institutions are multidimensional and, as such, changes in the quality of different institutions often play conflicting roles in determining sector-level FDI. In the sectors of: Mining, Utilities, and Communications and Transport, FDI is associated with low levels of political rights, and high levels of civil liberties, whilst, the opposite holds for FOI in Agriculture, Manufacturing , Construction, Finance and Oil/Petroleum. Market size and trade openness are found to be important determinant in most sectors, whilst wages are either insignificant or inversely related to FOI. We also examine, from a historical perspective, the political economy surrounding changes in FOI policy as well as the evolving FDI trends, made available by the new dataset. We find, on the one hand, that the degree of political sensitivity to liberalisation, at sector-level, determines the availability and contract-modality of opportunities for foreign investors. On the other hand, geographical characteristics of each sector determine the type of political environment that is most conducive to increases in FDI. For this purpose we propose an extension of the definition of key geographical characteristics. We present an original framework, matching the two dimensions of sector-level characteristics to FDI contractmodality and political-conducive environment to increased FDI.

A country’s human capital has been neglected as a potential determinant of inwards foreign direct investment (FDI), both in theory and empirical research. When human capital has been included in models of the determinants of FDI, it appears simply as a control variable or one of the variables in a “kitchen sink” approach, usually without any theoretical rationale for its inclusion or critical discussion of the measures used. The mis-specification that may result from this is advanced as one of the potential explanations for the very diverse findings in previous literature and the failure of the meta-regression analysis (MRA) reported in this thesis to find an ‘authentic’ effect of human capital on inwards FDI. Accordingly, this research seeks to fill this gap, by identifying the mechanisms through which human capital is expected to attract FDI to European transition economies and drawing conclusions about the most appropriate measures of human capital given the characteristics of the former communist (education) system. The ‘productivity-enhancing’ skills and traits that (foreign) investors are likely to value in such economies are identified and the manner in which these skills are developed is analysed. In the light of this analysis the conventional human capital measures used in empirical analyses are critically assessed. These contributions are used to develop an empirical model for estimating the effect of human capital on inwards FDI at country-, sector- and industry-level in 12 European transition economies during the period 1995-2008. Consistent with the results of previous studies, as suggested by the MRA, no significant effect of traditional volume measures of human capital on FDI inflows/stocks is found. However, some evidence is presented in this thesis indicating that the quality dimension of human capital as measured by cognitive skills proxies may affect inwards FDI in the manufacturing sector. Accordingly, several potential explanations for the findings and some of their implications for future macro-level research focusing on the effects of human capital are explored.

Ένα χαρακτηριστικό γνώρισμα της παγκόσμιας οικονομίας τις τελευταίες δεκαετίες αποτελεί η εντυπωσιακή αύξηση των ξένων άμεσων επενδύσεων (ΞΑΕ), καθώς συντελούν στην επιτάχυνση της αναπτυξιακής διαδικασίας. Οι ΞΑΕ πραγματοποιούνται μέσω εξαγορών & greenfield επενδύσεων. Στη παρούσα εργασία ξεδιπλώνονται αυτές οι δύο επιλογές εισόδου όχι ανεξάρτητα η μία από την άλλη αλλά συγκριτικά, εξετάζοντας την παρουσία τους διαχρονικά, την επίδραση που ασκεί η καθεμία στη χώρα υποδοχής, την αποδοτικότητα και τη βιωσιμότητά τους. Επιπλέον, αναδεικνύονται οι κρίσιμοι παράγοντες που καθορίζουν τη μορφή εγκατάστασης σε μια ξένη χώρα, και αναλύονται υπό το πρίσμα των κυρίαρχων θεωριών και εμπειρικών μελετών. Παρουσιάζεται επίσης, η εξέλιξη των εξαγορών και greenfield επενδύσεων -όπως αυτή έχει διαμορφωθεί από την παγκόσμια οικονομική κρίση-σε καθένα από τα επίπεδα της οικονομικής ανάπτυξης των ξένων χωρών, και διατυπώνονται οι σχετικές προβλέψεις. Τέλος, αναλύεται η διαχρονική εξέλιξη των ΞΑΕ επενδύσεων στην Ελλάδα. / In the last decades, the main feature of the global economy is an amazing increase in the foreign direct investments (FDIs), as they contribute to the acceleration of the development process. The FDI is performed through acquisitions and greenfield investments. In this paper these two modes of entry are unfolded not independently the one from the other but comparatively, viewing their diachronic presence, their influence to the host country, their performance and their survival. In addition, the major factors that determine the foreign entry mode are spotlighted and considered through the prism of the dominant theories and empirical studies. Moreover, the evolution of acquisitions and greenfield investments-as it has been formed by the global economic crisis- is introduced in every economic level, and relevant predictions are declared. In conclusion, a diachronic analysis of FDI in Greece is included.

Orientadora : Profª Drª Márcia Maria dos Santos Bortolocci Espejo / Dissertação (mestrado) - Universidade Federal do Paraná, Setor de Ciências Sociais Aplicadas, Programa de Pós-Graduação em Contabilidade. Defesa: Curitiba, 2012 / Inclui referências : fls. 105-110 / Área de concentração : Contabilidade e finanças / Resumo: O presente estudo foi desenvolvido com a finalidade de identificar os fatores econômicos que foram considerados no uso do orçamento de capital para subsidiar as decisões de investimento de investidores brasileiros no Paraguai. A escolha do país se justifica por ser o Brasil o segundo país que mais realiza Investimento Direto no Exterior no Paraguai, representando 15,3% do total do IDE do país, assim como verifica-se um aumento dos investimentos brasileiros diretos em participação de capital nos últimos anos, onde este investimento representou um aumento de 299,15% nos últimos quatro anos no Paraguai. Este país vem realizando um processo de atração de investimentos e encontra-se impulsionado pelo governo por meio de sua Legislação e a regimes tributários especiais como o Regime Maquila, que oferece diversos benefícios para empresas industriais que se instalem no Paraguai. Recorreuse à teoria para, numa perspectiva interpretativista de análise, compreender os fatores levados em consideração pelos gestores das empresas para a realização de um investimento no país, assim como identificar quais são as práticas referentes ao orçamento de capital realizados para o investimento. Para efeito da realização desse estudo, foram realizadas entrevistas com os gestores das empresas que realizaram investimentos no Paraguai, no ramo industrial, questionando quais foram as técnicas de análise que envolvam Orçamento de Capital e para efeito de fatores econômicos, foram analisados sob duas perspectivas: os aspectos institucionais, de acordo com Dunning (1988, 1997, 2001), e os aspectos motivacionais, de acordo com Brewer (1993). A pesquisa utilizará como estratégia de pesquisa uma entrevista semi-estruturada, onde existe a combinação de perguntas abertas e fechadas, onde o informante tem a possibilidade de discorrer sobre o tema proposto, a interrogação foi realizada às pessoas do escopo da pesquisa, investidores brasileiros que possuem investimento industrial no Paraguai. As entrevistas foram realizadas por telefone ou videoconferência de acordo com a disponibilidade do investidor. Em relação ao posicionamento ontológico, a pesquisa utilizou o paradigma da subjetividade, que busca entender a realidade percebida de acordo com os participantes da pesquisa. Para análise, a pesquisa utilizou a metodologia de Discurso do Sujeito Coletivo o que possibilitou construir metodologicamente a expressão do pensamento coletivo. Foram entrevistados gestores de dez indústrias brasileiras instaladas no Paraguai das quais cinco pertenciam ao regime Maquila e as outras cinco ao regime normal de tributação. A análise foram identificadas doze Ideias Centrais nos discursos dos gestores. Estas Ideias Centrais foram relacionadas aos modelos de internacionalização produtiva propostos por Dunning (1988, 1997, 2001) e Brewer (1993). Percebeu-se que, de acordo com Dunning (1988, 1997, 2001), as vantagens mencionadas nos discursos pertencem às vantagens de Localização pois foram mencionadas vantagens que são inerentes ao Paraguai, país receptor do IDE. As mesmas Ideias Centrais mencionadas pelos entrevistados foram categorizadas pelo modelo proposto por Brewer (1993) que propôs a classificação do IDE conforme quatro principais razões para investir de acordo com o projeto desejado. As análises demonstraram que as Ideias Centrais dos discursos encontram-se divididas em três motivações para o IDE, que são o Market-seeking Project, Efficiency-seeking projects e Resource-seeking projects. Destaca-se a importância que as empresas dos países fronteiriços possam aproveitar as vantagens competitivas que os países possam oferecer, fomentando assim o econômico crescimento regional, fundamental para a competitividade em nível global. Em relação às práticas de Orçamento de Capital, ainda é realizada de forma empírica pelas indústrias brasileiras instaladas no Paraguai. Palavras-Chave: Investimento Direto no Exterior. Fatores econômicos. Orçamento de Capital. / Abstract: The present study was conducted to identify economic factors that were considered in the use of the capital budget to subsidize the investment decisions of investors Brazilians in Paraguay. The choice of country is justified because Brazil is the second country that performs Direct Investment Abroad in Paraguay, representing 15.3% of total FDI in the country, as there is an increase in Brazilian direct investments in share capital in recent years, where this investment represented an increase of 299.15% over the last four years in Paraguay. This country has been carrying out a process of attracting investment and is driven by the government through its legislation and special tax regimes as the Maquila Regime, which offers several benefits for industrial companies that are setting up in Paraguay. We resorted to the theory, an interpretive perspective of analysis, understanding the factors taken into consideration by managers of companies for an investment in the country, as well as identify which are the practices relating to realized capital budget for investment. For the purpose of conducting this study, interviews were conducted with managers of firms investing in Paraguay, in the industrial, questioning what were the analytical techniques involving Capital Budget and effect of economic factors were analyzed from two perspectives: institutional aspects, according to Dunning (1988, 1997, 2001), and motivational aspects, according to Brewer (1993). The research uses as a research strategy a semi-structured, where there is a combination of open and closed questions where the respondent has the possibility to discuss the theme, the interrogation was done to the people of the scope of the search, Brazilian investors have industrial investment in Paraguay. The interviews were conducted by telephone or video conference according to the availability of the investor. Regarding the ontological position, the research used the paradigm of subjectivity, which seeks to understand the perceived reality in accordance with the research participants. For analysis, the research used the methodology of the Collective Subject Discourse which enabled methodologically construct the expression of collective thought. We interviewed managers of ten Brazilian industries installed in Paraguay five of which belonged to the Maquila regime and the other five to the normal tax. The analysis identified twelve central ideas in the speeches of the managers. These ideas were central to the related models of productive internationalization proposed by Dunning (1988, 1997, 2001) and Brewer (1993). It was noticed that, according to Dunning (1988, 1997, 2001), the advantages mentioned in the speeches belong to the advantages of location were mentioned as advantages that are inherent in Paraguay recipient country of FDI. The same central ideas mentioned by respondents were categorized by the model proposed by Brewer (1993) proposed that the classification of FDI as the four main reasons to invest according to the desired design. The analyzes showed that the central ideas of the speeches are divided into three motivations for FDI, which are Marketseeking Project, Efficiency-seeking projects and resource-seeking projects. Highlights the importance that companies of neighboring countries can seize the competitive advantages that countries can offer, thus fostering economic regional growth, crucial for competitiveness globally. In relation to the practices of the Capital Budget, is still performed empirically by Brazilian industries installed in Paraguay. Keywords: Direct Investment Abroad. Economic factors. Capital Budget.