2004年-世界发展银行全球_Does_It_Matter_Where_You_Come____________From__Vertical_Spillovers_from_Foreign_Direct_Investment_and____________the_Nationality_of_Investors_22页_335kb

Summary of "Does It Matter Where You Come From? Vertical Spillovers from Foreign Direct Investment and the Nationality of Investors"

Core Content

This study investigates whether the nationality of foreign investors affects the degree of vertical spillovers from Foreign Direct Investment (FDI) in Romania, using a firm-level panel dataset. It focuses on how the presence of foreign firms in downstream industries influences the productivity of domestic firms in upstream sectors that supply intermediate inputs. The paper suggests that the country of origin of investors plays a significant role in determining the extent of these spillovers, particularly through local sourcing and preferential trade agreements.

Main Points

• FDI and Spillovers: FDI is believed to generate knowledge spillovers to domestic firms, especially through vertical linkages where multinational firms source inputs from local suppliers.
• Hypothesis: The nationality of foreign investors affects the degree of vertical spillovers. Specifically, American and Asian investors are expected to source more from Romania due to:
  • Distance Effect: The share of intermediate inputs sourced from a host country is positively correlated with the distance between the headquarters and the host country.
  • Trade Agreements: Preferential trade agreements (e.g., Romania-EU Association Agreements) reduce tariffs on EU imports, making it less attractive for European investors to source from Romania.
  • Rules of Origin: European investors can use home country suppliers for intermediate inputs while American and Asian investors cannot, leading to greater local sourcing by the former.

Key Findings

• The presence of American and Asian companies in downstream sectors is positively correlated with the productivity of Romanian firms in upstream sectors.
• Conversely, the presence of European investors in downstream sectors is negatively correlated with the productivity of Romanian firms in upstream sectors.
• These differences in effects are statistically significant.
• The results are robust to controlling for firm-specific fixed effects and endogeneity corrections (Olley and Pakes, 1996).
• Horizontal spillovers (within the same industry) also show positive effects on productivity.

Data and Methodology

• The data comes from the Amadeus database, which includes 50,597 firms in Romania, with over 11% foreign-owned.
• The sample includes foreign affiliates from Europe, America, and Asia, with European investors accounting for 61%, American for 8%, and Asian for 10% of the FDI stock.
• The study uses a Cobb-Douglas production function and estimates a log-linear model to assess the impact of foreign presence on domestic productivity.
• The vertical spillover proxy is defined as the weighted sum of foreign presence in downstream sectors, based on input-output matrix data.
• The horizontal spillover proxy measures the share of output in an industry produced by firms with foreign equity.

Empirical Results

• Without correction: The fixed effect model shows statistically significant positive associations between American and Asian FDI and domestic productivity, and negative associations with European FDI.
• With Olley-Pakes correction: The results remain consistent, with American and European FDI still showing significant positive effects on productivity, while Asian FDI loses significance.
• Clustering correction: Standard errors are clustered by industry and year to account for within-industry correlation. This increases standard errors on spillover variables, but statistical significance is retained for American and European FDI.
• Conclusion: The nationality of foreign investors does matter for vertical spillovers. Firms from non-EU countries (America and Asia) are more likely to generate positive productivity spillovers due to greater local sourcing and less trade restrictions.

Implications

• European investors may not be as effective in generating vertical spillovers due to preferential trade agreements and less local sourcing.
• FDI inflows from faraway countries not part of the preferential trade agreement are more likely to be associated with positive vertical spillovers.
• Competition in downstream industries may lead to displacement of local firms, which could reduce the demand for domestic intermediates and lower productivity in upstream sectors.

Conclusion

The study concludes that foreign investor nationality does influence the degree of vertical spillovers from FDI. American and Asian investors are more likely to generate positive productivity spillovers to Romanian firms in upstream sectors, while European investors have a negative impact. This is attributed to distance, trade agreements, and rules of origin affecting sourcing behavior and spillover potential. The results highlight the importance of investor origin in shaping the economic impact of FDI.