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FDI and trade : two way linkages?

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Item Summary Noy, Ilan Aizenman, Joshua 2008-11-19T19:06:10Z 2008-11-19T19:06:10Z 2005
dc.description For more about the East-West Center, see <a href=""></a>
dc.description.abstract The purpose of this paper is to investigate the intertemporal linkages between FDI and disaggregated measures of international trade. A model exemplifying some of these linkages is outlined, describing several methods for investigating two-way feedbacks between various categories of trade, and applying them to the recent experience of developing countries. After controlling for other macroeconomic and institutional effects, the strongest feedback between the sub-accounts is between FDI and manufacturing trade. More precisely, applying Geweke (1982)'s decomposition method, most of the linear feedback between trade and FDI (81%) can be accounted for by Granger-causality from FDI gross flows to trade openness (50%) and from trade to FDI (31%). The rest of the total linear feedback is attributable to simultaneous correlation between the two annual series.
dc.format.extent 25, [2], 4 pages
dc.language.iso en-US
dc.publisher Honolulu: East-West Center
dc.relation.ispartofseries East-West Center working papers. Economics series ; no. 76
dc.subject.lcsh Investments, foreign - Econometric models
dc.subject.lcsh International trade - Econometric models
dc.subject.lcsh International finance - Econometric models
dc.subject.lcsh Capital movements - Econometric models
dc.title FDI and trade : two way linkages?
dc.type Papers
dc.type.dcmi Text
Appears in Collections: Economics [Working Papers]

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