Abstract. The study investigates the impact of cross-border mergers and acquisitions on GDP per capita and domestic investment in 22 European transition countries from 2000 to 2014 by using the system Generalized Method of Moments estimator. The main implications are that cross-border mergers and acquisitions have a negative effect on GDP per capita in the year of merger or acquisition, while their lagged level shows a positive impact. From long-term perspective, this type of FDI has negative and significant effect on GDP per capita. The results show that one-year lagged cross-border mergers and acquisitions positively affects domestic investment, suggesting that spillover effects of this type of investment can be expected not earlier than one year after the merger or acquisition. The value of this paper is that our results show how the advances in structural reforms enhance GDP per capita whereas their influence on domestic investment activity is insignificant. We found that there is insignificant impact of the relationship between overall structural reforms and cross-border mergers and acquisitions on GDP per capita and domestic investment both in short and long run. The originality of this study lies in investigation of the dynamic nature of cross-border mergers and acquisitions and their economic effects depending on the quality of structural reforms.
This paper deals with the economic effect of cross-border mergers and acquisitions on GDP per capita in European transition countries for the 2000- 2014 period. Our analysis shows that cross-border mergers and acquisitions have a negative effect on GDP per capita in the current period, whereas their lagged level positively impacts output performance. We found that transition countries characterized by a higher quality of institutional setting have achieved a positive impact on GDP per capita.
Foreign direct investments play a vital role in generating economic growth. National governments as well as local communities therefore need an appropriate strategy for attracting foreign direct investments on the one hand and maximizing their benefits on the other.In the proposed chapter, authors discuss the development and effects of foreign direct investments on local communities of Slovenia and Serbia. "ased on data gathered through a questionnaire, a comparative statistical analysis was used to find stylized facts, which could be a sign of a different stage of transition in both countries. The study was conducted at the end of , and the sample consists of communities from Slovenia and communities from Serbia. The study proves that the more progressive path of transition in Slovenia was not offset by a significantly higher level of foreign direct investment activities. In both countries, however, foreign direct investments proved to have mostly positive effects on the economic development of the local communities concerned.
This paper aimed to investigate the FDI determinants in 27 transition countries within the 2002 – 2018 period by employing system GMM analysis. One of the results of our research is that an uncertain political situation and civil liberties violations have a significant negative impact on foreign investors’ confidence. Generally, the erosion of democratic institutions acts as a deterrent to FDI inflows. Transition countries which experienced prolonged periods of central planning also recorded lower levels of FDI inflows. The results show that creating conditions for stimulating foreign investors through the improvement of institutional quality embodied in the control of corruption and voice and accountability impacted positively on FDI inflows. The interplays between overall institutional quality, voice and accountability, regulatory quality, government effectiveness and GDP growth are positive and significant. Hence, macroeconomic development has an important impact on the marginal effect of institutional quality. Therefore, we concluded that the influence of governance on FDI inflows is conditional on the transition countries’ macroeconomic performance. Our findings also reveal that of the governance dimensions, control of corruption and voice and accountability have a significant influence on the decision of multinationals to undertake investment.
Despite a pandemic that has brought most of the global economy to its knees, Chinese economic growth continued in 2020 and strongly accelerated in 2021. An almost certain scenario in which China is becoming the leading world economy already brings strong geopolitical implications, primarily in the form of shaking the existing world order, which is practically managed by Washington. The key reason for the strong growth of China’s economy is the high share of both savings and investments in GDP (over two-fifths each) in a very long period, together with its impressive technological progress. In this regard, the direct reason for the current tension between the two countries is China’s economic transformation towards the upper end of global industrial value chains. Attempts to end China’s economic expansion through forced technological unbundling, US trade sanctions, or forced changes in global supply chains, seem doomed to failure given its vast internal market and conquest of entire product ranges or supply chains. America will continue with its efforts to maintain primacy over China in the basic technologies of the future, from artificial intelligence to quantum computing, with the help of huge investments in science. Although the US and China are not necessarily on the path of confrontation, this certainly cannot be ruled out. The aim of this paper is to project the future of the American and Chinese economies' dynamics of GDPs. The applied methodology is based on a linear projection of the GDP growth of both countries in the period after 2026.
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