Foreign Direct Investment, Technology Diffusion, and Host Country Productivity Growth

Publication | August 2011

This paper investigates whether foreign direct investment (FDI) has statistically significant effects on host countries' economic performance, such as total factor productivity. It evaluates whether these spillover effects depend on the sending countries' income levels, and shows that the impacts of FDI from developed countries, North - South effects, are more prevalent, but not the South - South effects.

Contents 

  • Abstract
  • Introduction
  • Literature Review
  • Pattern of FDI Flows: An Initial Look
  • Data and Summary Statistics
  • Empirical Specification and Results
  • Conclusions
  • Appendix: How FDI Data was Computed
  • Bibliography