The Impact of Foreign Direct Investment on the Romanian Labour Market: New Evidence from a Pooled Model

Maxim, Laura Diaconu; Șterbuleac, Daniel

doi:10.1515/tjeb-2017-0002

Cited by 1 publication

(1 citation statement)

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“…Mah took South Korea as the research object and concluded that FDI would bring more serious income inequality to South Korea [29]. Diaconu et al also found evidence from Romania's domestic labor market that FDI will widen the income gap of employees in different industries [30]. This research shows that FDI inflow has the potential to have a 'widening income gap' effect on Romania's domestic labor market.…”

Section: Literature Reviewmentioning

confidence: 81%

The Impact of FDI on China’s Urban–Rural Income Gap

Shi

Chen²,

Tang³

et al. 2022

Sustainability

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Since the reform and opening up some forty years ago, China has suffered from a capital shortage problem. To both solve this problem and satisfy its economic and social needs, China has been bringing in foreign investment, much of which has gone toward economic reconstruction. However, with the continuous inflow of foreign direct investment (FDI) into China, not only has the gap between rich and poor become increasingly wide but, due to China’s unique dualistic economic structure, the gap between urban and rural areas also appears to be widening. This aspect of the problem has attracted the attention of scholars around the world, as it may affect the future sustainable development of China’s economy and society. Cognizant of the need for practical solutions, this study conducts a more in-depth study of the relationship between foreign direct investment and the urban–rural income gap in China. Based on a review of previous studies and panel data from 30 Chinese provinces, this paper argues that FDI will affect this income gap through mechanisms such as employment structure, industrial structure and international trade. The findings of this study suggest that FDI inflows will first improve income inequality between urban and rural Chinese at a point in time but then have a worsening effect. In addition, China’s three major economic zones are examined, with results showing that the overall impact of FDI on the urban–rural income gap in China displays an inverted ‘U’ curve. Today, the impact of FDI on the urban–rural income gap is on the right-hand side of the curve, with regional differences in its impact. Urban–rural income inequality in the eastern region responds the most to FDI.

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Section: Literature Reviewmentioning

confidence: 81%