FDI, Corruption and Development of Public Service Sectors in ASEAN Countries

Abstract

This study aims to empirically examine the effect of foreign direct investment (FDI) and corruption on the development of public-service sectors in 10 ASEAN countries. It then investigates whether this relationship is different between two FDI compositions including greenfield FDI and FDI in the form of cross-border merger and acquisitions (M&As). Using a panel database of 10 ASEAN countries during the period 1996-2015 from various sources including the World Development Indicators of the World Bank and UNCTAD, we first find that FDI strongly and positively contributes to the development of the public-service sectors in the recipient nations, except for the electricity sector. However, we show that this relationship is dependent on the type of FDI modes of entry. Specifically, while greenfield investment exerts a beneficial influence on the development of telecommunication and transportation sectors, cross-border M&A has no effect on these sectors, perhaps because of the distinct differences among three public service sectors. Finally, we found that in a highly corrupt environment, aggregate FDI might have no influence on all three public-service sectors, possibly because the two contradictory influences of the interaction terms between corruption and two FDI sub-types seem to cancel each other out.

Exploration on terrorism, ecological footprint and environmental sustainability in countries with the most terrorism antecedent: Accessing evidence from panel fourier analysis

“…The empirical literature on the relationship between FDI inflows and environmental degradation have reached mixed consequences. [ [46] , [47] , [48] , [49] , [50] , [51] , [52] , [53] ], have uncovered that FDI inflows increased the environmental degradation, but [ [54] , [55] , [56] ] discovered that FDI inflows fostered the environmental improvement. However [ 8 , 57 ], have been concluded that the effects of FDIs on environmental degradation are different in the short and long term [ 58 ].…”

“…In addition, an inverted U-shaped relationship was found between FDI and CO 2 emissions for the Asian sub-panel. [ 50 ] System generalized moment method (system-GMM) FDIs have a positive effect on environmental pollution. [ 51 ] Multivariate regression model There was evidence of the existence of the pollution haven hypothesis in the Balkans, while the EKC hypothesis was rejected.…”

On Capital Flight from the ASEAN-8 Countries: A Panel Data Estimation

“…Sources of funds include all net official inflows (increase in public sector net external debt) and net flows of foreign direct investment. Users of funds include current account deficits and changes in foreign exchange reserves (Phan and Nguyen, 2020). Capital flight out occurs when the source of funds exceeds the use of funds and vice versa for the flight of capital in, so that the residuals of both are indicated as outward or inward capital flights.…”