This paper investigates the effect of foreign presence on the productivity of manufacturing industries in Ghana, using firm level panel data. We examine both labor and total factor productivity (TFP), which we compute using the Levinsohn and Petrin (2003) methodology. We control for a number of observed factors as well as unobserved heterogeneity in several dimensions. We find robust evidence that the presence of foreign firms in a sector has a negative effect on domestically owned, but a positive effect on most foreign owned firms. Unlike in recent work on China, it does not appear that the negative level effect is compensated for by a positive growth effect, at least not in any reasonable time period. This finding underscores that care must be exercised in extrapolating results from one country to others. We find no evidence of any wage effects.

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This paper analyses whether foreign direct investment (FDI) has contributed to employment generation in Mexico's non-maquiladora manufacturing sector. Drawing on highly disaggregated FDI and employment data, we estimate dynamic labour demand functions for blue and white collar workers, including FDI as well as its interaction with major industry characteristics. FDI has a significantly positive, though quantitatively modest impact on manufacturing employment in Mexico. This applies to both white collar and blue collar employment. The employment enhancing effects of FDI are larger in export oriented industries. In more capital-intensive industries, the employment effect of FDI remains positive for blue collar workers but not white collar ones.

Abstract:We empirically assess the determinants of India's FDI outflows across a large sample of host countries in the 1996-2009 period. Based on gravity model specifications, we employ Poisson pseudo maximum likelihood (PPML) estimators. Major findings include: India's outward FDI is hardly affected by motives to access raw materials or superior technologies. Market-related factors appear to have dominated the location choices of Indian direct investors. A larger Indian diaspora in the host countries attracts more FDI. Finally, it seems that Indian direct investors are relatively resilient to weak institutions and economic instability in the host countries. However, we do not find robust evidence that India provides an alternative source of FDI for countries that traditional investors tend to avoid.

Consumption is partly a social activity, yet most studies of consumer behavior treat households in isolation. We investigate familial relationships in consumption patterns using a sample of parents and their children from the Panel Study of Income Dynamics. We find a positive and statistically significant parent-specific effect on children's consumption even after controlling for the effect of parental income, and we find similar effects for sibling pairs. Child consumption responds negatively to large post-retirement shortfalls in consumption of the parents. This behavior holds up even after allowing for the possibility of smaller parent-to-child transfers made necessary by the parental consumption shortfalls. These results suggest that although income is an important source of the intergenerational correlation, parental choices and experiences also affect consumption behavior of the children.