FDI: Hot or Cold Money? The Behaviour of Sectoral FDI Inflows and Outflows Over Periods of Growth Accelerations and Decelerations

Doytch, Nadia

doi:10.1177/00157325221092614

Cited by 4 publications

(3 citation statements)

References 74 publications

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“…Further, according to Doytch (2021), the most sensitive sectoral flow to both democratization and control of corruption is the financial services FDI. And, Doytch (2022) confirms that control of corruption is critical for attracting financial services FDI and manufacturing FDI inflows in OECD countries, while institutional factors matter very little for the outflows of FDI. In addition, only manufacturing FDI is found to be important for FDI inflows in the same context.…”

Section: Host Country Institutions As Drivers Of Inward Foreign Direc...mentioning

confidence: 69%

Do institutions impact differently inward greenfield FDI and cross-border M&A sales? A study of five institutional quality indicators in developed and developing countries

Doytch,

Ashraf

2023

JFEP

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Purpose This study aims to test the impact of different institutional quality indicators on two modes of foreign direct investment (FDI)-greenfield investment and cross-border mergers and acquisitions (M&As) for a sample of 110 countries over the period 2003–2017. Design/methodology/approach The authors develop a model of well-known FDI determinants, such as market size and potential, openness, the value of the national currency and the quality of institutions. The authors examine one-by-one five different institutional factors: law and order, investment profile of the host country, control of corruption (anti-corruption); democratic accountability, and government stability, applying a generalized method of moments (GMM) estimator that assures no endogeneity and reverse causality of the key explanatory variables. Findings The results point out the fact that fertile institutional conditions for attracting greenfield FDI to developing countries require law and order, good investment conditions and a state of democracy, but not necessarily tight control of corruption and a stable government. On the other hand, the appropriate institutional environment for attracting cross-border M&A sales flows to developing countries includes strong law and order, good investment conditions, strict control of corruption and strong democratic accountability. The results for developed countries show overall smaller importance of institutions as a determinant of both types of FDI. Originality/value This is the first study to analyze the differentiated determinants of the two modes of investment. The study holds implications for crafting two different policies for attracting greenfield FDI and M&A sales.

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Section: Host Country Institutions As Drivers Of Inward Foreign Direc...mentioning

confidence: 69%

Do institutions impact differently inward greenfield FDI and cross-border M&A sales? A study of five institutional quality indicators in developed and developing countries

Doytch,

Ashraf

2023

JFEP

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“…In 2015, a 9% increase in FDI flow was observed compared to the previous year. 8 According to the World Investment Report (2016), OFDI decreased in most developing and emerging economies, while the OFDI of China increased to USD 128 billion in 2015. 9 Due to the rapid interaction and technological advancement, the outflow of FDI has tremendously grown in China.…”

Section: Outw Utward Foreign Direct Investment: a New Channel For Dev...mentioning

confidence: 99%

Outward FDI: Determinants and Flows in Emerging Economies: Evidence from China

Zreik¹,

Iqbal²,

Rahman³

2022

China & WTO Rev.

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Outward Foreign Direct Investment (OFDI) is the cross-border capital flow with the objective of the long-term association having at least a ten percent stake in the equity of the host country firm. In the case of new investment, the total equity is OFDI. This research aims to analyze OFDI in the context of China. The lasting interest is considered 10% equity, thereby saying that if the cross-border investment is at least 10% of the equity share capital, the investment would be considered FDI; if below 10%, it is considered to be a Portfolio Investment. We have applied a more emic approach and discussed the determinants of multinational companies (MNCs) from China. Using an exploratory and qualitative approach, case studies of Chinese MNCs are discussed. Secondary data is utilized to obtain a closer insight into the determinants of OFDI from Chinese MNCs. At the end of this paper, suggestions for OFDI policymakers and study limitations are discussed. This research makes recommendations to the Chinese government regarding OFDI in connection with their economic development.

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“…The fifth article by Nadia Doytch (Doytch, 2022) explores the responsiveness of sector-level FDI inflows and outflows to economic accelerations and decelerations in the wake of the COVID-19 pandemic economic crisis and anticipated prolonged economic recession. The results suggest that financial services FDI and both transport services FDI inflows and outflows are countercyclical.…”

Section: Introductionmentioning

confidence: 99%