FDI, Trade, and Growth Dynamics: New Evidence from the Post-Reform India

Dash, Ranjan Kumar; Sharma, Chandan

doi:10.1080/08853908.2011.554787

Cited by 29 publications

(27 citation statements)

References 29 publications

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“…We find that tax havens compete with each for capital flows, which is consistent with Dash and Sharma's (2011) finding for developing countries. The evidence provided by this study tells us that government policy in tax havens is likely to be shaped by the competition they face, where these countries will find ways to make themselves more attractive than the nearby tax haven.…”

Section: Discussionsupporting

confidence: 89%

“…For example, Kudrle (2008) reported a 154% growth in total liabilities from 1998 to 2006 for a sample of 20 tax havens. Attracting foreign direct investment (FDI) is considered to be an important factor for stimulating economic growth for both developed and developing countries (Dash and Sharma 2011;Lee 2005;Nissan and Niroomand 2010). Fearing the harmful impacts of tax haven policies, OECD countries launched the 1998 Harmful Tax Competition (HTC) initiatives.…”

Section: Introductionmentioning

confidence: 99%

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Competition between Tax Havens: Does Proximity Matter?

Blanco

Rogers

2012

The International Trade Journal

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We study whether proximity to the nearest tax haven affects FDI and the number of American affiliates in a tax haven. Our results show that distance to the nearest tax haven is positively related to FDI inflows and the number of American affiliates in tax havens. These findings suggest that there is harmful competition between tax havens. We also find evidence of positive spillovers: the number of American affiliates in a tax haven is positively related to the number of affiliates in its closest neighboring tax haven. This suggests the presence of agglomeration benefits given there is an affiliate in a nearby tax haven.

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Section: Discussionsupporting

confidence: 89%

Section: Introductionmentioning

confidence: 99%

Competition between Tax Havens: Does Proximity Matter?

Blanco

Rogers

2012

The International Trade Journal

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“…In addition, the positive impact of FDI on economic growth in India was discovered by Chakraborty and Nunnenkamp (2008) to be largely restricted to the manufacturing sector; whilst no evidence of any causal relationship in the primary sector between FDI and economic growth in India was found. Dash and Sharma (2011) concurred in their findings that the causal relationship between FDI and economic growth is bidirectional. This view was supported by Chowdhury and Mavrotas (2005), whose study showed a strong bidirectional causal relationship between FDI and economic growth in both Malaysia and Thailand.…”

Section: Fdi and Economic Growth: Theoretical And Empirical Overviewmentioning

confidence: 55%

Foreign direct investment and economic growth in Zimbabwe: a dynamic causality test

Tsaurai

Odhiambo

2012

IJEPEE

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Abstract:In this study we examine the dynamic causal relationship between foreign direct investment (FDI) and economic growth in Zimbabwe -using the modern time-series techniques. Specifically, we employ the ARDL-bounds testing approach to examine the FDI-growth linkage. We also employ the error-correction-based causality test, which captures both the short run and long run dynamics. Contrary to some of the previous studies, this study shows that there is a distinct causal flow from economic growth to FDI in Zimbabwe. The results apply irrespective of whether the causality test is conducted in the short run or in the long run. The study, therefore, recommends that Zimbabwe should pursue pro-growth strategies, in order to promote foreign direct investment.

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“…However, empirical studies indicate that causality between exports and FDI is complicated and depends largely on the types of exports and FDI being considered. It is country, industry, and even firm specific (Zhang and Felmingham 2001;Liu et al 2002;Girma et al 2008;Dash and Sharma 2011). This suggests the importance of empirical investigations in assessing true FDI-export relationship.…”

Section: Causality Between Exports and Fdimentioning

confidence: 96%

“…Sahoo (2004a, b) uses the co-integration and causality analysis with an error correction model (ECM) and finds a bidirectional causality between FDI and manufacturing exports both in long run as well as in short run in India. Dash and Sharma (2011) examine the direction of causality between FDI and exports for four South Asian countries using quarterly data for the period 1990 Q1-2007 Q4. The results of this study indicate that there exist bidirectional causality between FDI and export for three countries, namely, India, Bangladesh, and Pakistan.…”

Section: Review Of Empirical Literaturementioning

confidence: 99%