The Positive Casual Impact of Foreign Direct Investment on Productivity: A Not So Typical Relationship

Rodolphe Desbordes, Vincenzo Verardi

Research output: Working paperDiscussion paper

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Abstract

Previous research has argued that foreign direct investment (FDI) exerts a positive and causal impact on the productivity of the recipient countries. However, we find that there is little macroeconomic evidence that FDI fosters productivity growth in recipient countries, including in those with high absorptive capacity, once we use an instrumental variables (IV) estimator robust to outliers.
Original languageEnglish
Place of PublicationGlasgow
PublisherUniversity of Strathclyde
Pages1-45
Number of pages46
Volume11
Publication statusPublished - Feb 2011

Keywords

  • foreign direct investment
  • productivity
  • robust regression

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