Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries

FDI is considered to be a meaningful component for the economic growth of a country. But, it has not been proven clear that the effect of FDI is really beneficial in a host country regardless of the state of the countries. This paper tries to provide an evidence of the effect of FDI in developing co...

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Main Authors: Tae Seung Kim, Hun-Koo Ha, Jin Kook Lee
Format: Article
Language:English
Published: Emerald Publishing 2008-12-01
Series:Journal of International Logistics and Trade
Online Access:https://www.emerald.com/insight/content/doi/10.24006/jilt.2008.6.2.103/full/pdf
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author Tae Seung Kim
Hun-Koo Ha
Jin Kook Lee
author_facet Tae Seung Kim
Hun-Koo Ha
Jin Kook Lee
author_sort Tae Seung Kim
collection DOAJ
description FDI is considered to be a meaningful component for the economic growth of a country. But, it has not been proven clear that the effect of FDI is really beneficial in a host country regardless of the state of the countries. This paper tries to provide an evidence of the effect of FDI in developing country. To do this, we relate industry level value-added to inward and outward FDI stocks in Korea in a production function framework. Especially we divide inward FDI into FDI on the Greenfield projects and FDI for M&A. The results show that the effect of inward FDI as a whole on productivity is not statistically significant, though we can presume that the direction is positive, whereas the effect of outward FDI is strongly negative, and is statistically significant. But the effects of inward FDI by the characteristics of FDI are not differentiated.
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spelling doaj.art-e8c9bbcb3bc84616b69c78d43469bffb2023-11-17T10:43:18ZengEmerald PublishingJournal of International Logistics and Trade1738-21222508-75922008-12-016210311910.24006/jilt.2008.6.2.103Do domestic firms benefit from FDI?: evidence from Korean manufacturing industriesTae Seung Kim0Hun-Koo Ha1Jin Kook Lee21Graduate School of Logistics, Inha University, 253 Yonghyun-dong, Nam-Gu Incheon 402-751, Korea2Department of Law and Asia Pacific School of Logistics, Inha University, 253 Yonghyun-dong, Nam-Gu Incheon 402-751, Korea1Graduate School of Logistics, Inha University, 253 Yonghyun-dong, Nam-Gu Incheon 402-751, KoreaFDI is considered to be a meaningful component for the economic growth of a country. But, it has not been proven clear that the effect of FDI is really beneficial in a host country regardless of the state of the countries. This paper tries to provide an evidence of the effect of FDI in developing country. To do this, we relate industry level value-added to inward and outward FDI stocks in Korea in a production function framework. Especially we divide inward FDI into FDI on the Greenfield projects and FDI for M&A. The results show that the effect of inward FDI as a whole on productivity is not statistically significant, though we can presume that the direction is positive, whereas the effect of outward FDI is strongly negative, and is statistically significant. But the effects of inward FDI by the characteristics of FDI are not differentiated.https://www.emerald.com/insight/content/doi/10.24006/jilt.2008.6.2.103/full/pdf
spellingShingle Tae Seung Kim
Hun-Koo Ha
Jin Kook Lee
Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
Journal of International Logistics and Trade
title Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
title_full Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
title_fullStr Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
title_full_unstemmed Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
title_short Do domestic firms benefit from FDI?: evidence from Korean manufacturing industries
title_sort do domestic firms benefit from fdi evidence from korean manufacturing industries
url https://www.emerald.com/insight/content/doi/10.24006/jilt.2008.6.2.103/full/pdf
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