Earticle

외국인 직접투자 유입은 지난 몇 십 년 동안 중국 경제성장의 동인이라고 알려져 있다. 기존의 연구들이 대부분 중국의 국가통계를 이용하여 외국인 직접투자 유입의 소득창출 효과를 분석한 반면, 본 연구에서는 중국의 지방(각성 및 주요 특구) 통계를 이용하여 다양한 성장가설을 검증하고자 하였다. 이를 위하여 먼저 중국의 31개 지역, 34년간의 연간자료를 이용하여 패널자료를 구축한 다음, 1) 지역단위에서 외국인투자유입이 실제 경제성장에 기여했는지, 2) 만약 기여했다면 얼마나 강력하게 그 효과가 나타나는지를 분석하고자 하였다. 또한 중국의 지역을 동부해안지대의 경제자유구역 및 개발특구그룹과 서부내륙지역의 非특구그룹으로 구분하여 성장가설을 검증하였다. 그 결과 두 그룹 사이에 개혁, 개방정책 강도, 도입시기의 큰 차이가 있음에도 불구하고, 여전히 외자유치-성장을 연결하는 이른바 “개방을 통한 성장방정식”은 두 그룹에서 거의 유사하게 나타나고 있음을 확인할 수 있었다.

Foreign direct investment (FDI) inflows have been known as a key growth driver in national China for the past several decades. However, China's open and reform policies were very discriminatory across regions in that they were applied exclusively to coastal provinces and cities along the Eastern China. In this study, we want to see whether the above “FDI-led growth formula” at China’s national level did work equally at China’s provincial level, too. After constructing and estimating a panel model, we tested how crucial and how different FDI inflows were in generating income in provinces of China, and confirmed that the FDI-led growth patterns did appear at provincial level as well. In addition, we repeated panel regressions using two sub-samples: Coastal areas (SEZs) vs. Inland areas (non-SEZs). Surprisingly, we could not find significant difference in the results between the two samples. It implies that the FDI-growth formula did work effectively at regional level, no matter where they are in SEZs or in non-SEZs.

The COVID-19 pandemic has brought great challenges to the global economy. Strict measures to control the pandemic adopted by the Chinese government have largely affected foreign direct investment (FDI) inflows in China. However, current research has ignored internal differences within China, especially differences in the level of institutional development. It has been widely recognized that the influence of the institutional environment on business activities of firms is important and the level of institutional development is directly related to the performance of firms. Thus, the objective of this study was to explore how the COVID-19 pandemic affected FDI inflows at the subnational level and whether institutional factors played a role in this process. We compiled a monthly data set on COVID-19 and FDI inflows in China at the provincial level from February 2020 to January 2022. The random effect model was adopted after conducting the Hausman test and then we performed the regression analysis in two steps. First, we used the pandemic data set to analyze impact of the pandemic on FDI inflows. Second, we classified 31 provinces into three groups according to the level of marketization. And then we tested how the pandemic affected the FDI inflows in three groups differently to explore the impact of institutional factors on foreign investor decision making in the context of the COVID-19 pandemic. Results showed that cumulative cases in a province did not have a significant impact on FDI inflows. However, current active cases and new confirmed cases in the province negatively affected FDI inflows, indicating that overseas investors were more concerned about the current situation of COVID-19 in the province. Analysis results after dividing all provinces into three groups according to marketization index showed that COVID-19 had no significant impact on FDI inflows in provinces with low levels of institutional development (Group L), but had significant negative effects in provinces with medium and high levels of institutional development (Group M and Group H). Furthermore, the coefficient of COVID-19 in Group H was much lower than that in Group M, indicating that a high level of institutional development could reduce the negative impact of COVID-19. This study provides a deeper understanding of the preferences and characteristics of FDI in China by exploring impact patterns of COVID-19 on FDI in different regions with different levels of institutional development.

지난 10년 동안 세계화가 빠르게 진행됨에 따라 FDI는 선진국에서 신흥국으로, 특히 개발도상 국에서 가장 두드러진 특징으로 나타났다. 특히 아시아, 아프리카 및 중남미 국가들은 FDI의 주요 대상국으로 부상하였다. 이에 본 논문에서는 1980년대부터 2019년까지 개발도상국의 패 널데이터를 이용하여 개도국의 FDI 유입 결정요인이 무엇인지 분석하였다. 분석대상은 개발 도상국 33개국 아시아, 아프리카 및 중남미 3개 그룹으로 구분하여, 그룹별 국가에 영향을 주 는 FDI결정요인이 무엇인지? FDI에 영향을 주는 종속변수와 금융발전, 시장규모, 거시경제, 인 프라시설, 무역개방성, 노동자원 6가지 독립변수로 하여 패널 데이터 분석을 실시하였다. 분석 결과 금융발전 수준, 시장 규모, 물가 수준 , 인프라 시설, 무역 개방성, 노동자원이 개발도상국 FDI 유입에 긍정적 요인으로 나타났으며, 아시아, 아프리카, 중남미 각 지역에 대한 분석결과 를 비교해보면 아시아의 경우 FDI 유입을 촉진하기 위해 시장 규모와 무역 개방성이 FDI 유입 요인으로 나타났다, 또한 아프리카의 경우는 인프라와 금융 개발, 중남미 지역의 경우 금융발 전 수준, 시장 규모, 노동자원 및 무역 개방성이 각각 FDI에 영향을 준 것으로 분석되었다.

Purpose : Foreign direct investment is one of the important economic characteristics in the modern globalized world. The flow of investments into developing economies is increasingly accounting for a large share of global FDI. The purpose of the study is to find out the factors that influence the attraction of foreign investment into developing countries. Research design, data, methodology : The study collected data from 33 countries in Asia, Africa, Latin, Central America, and Caribbean between 1980 and 2019. By using the Eviews, stationary test, fixed effects and random effects test to find variables that have a significant impact on the development of developing countries as well as each region of Asia, Africa, Central South America. Results : The results show that since 1980, financial development, market size, price stability, trade openness, infrastructure capacity and labor force have had a significant impact on FDI inflows to developing countries. However, when separating with Asia, Africa, the Americas, Central America and the Caribbean, different factors determine the FDI inflows of each region. For Asia market size and trade openness are influential factors that have a positive impact on attracting foreign capital inflows. The larger the trade openness, the more FDI inflows are attracted. Similarly, a larger market, encouraging efficient investment, has been particularly attractive to FDI investors in recent decades. For Africa, the level of financial development, market size, trade openness, infrastructure and labor source are the factors that influence the attraction of FDI inflows. While for Central South America, the level of financial development is the most significant variable affecting FDI attraction, followed by market size, labor source and trade openness are positive factors that have a significant impact on FDI inflows. Conclusions : Therefore, In order to promote FDI inflow, the level of financial development, market size, openness of trade, infrastructure construction and workers' resources should be established. And as the analysis shows, different FDI determinants in Asia, Africa, and Latin America are different, so policy planning and enforcement for each region are needed.

이 논문은 ‘개발도상국에 있어 ODA가 FDI 유입에 미치는 영향’을 추정하는데 그 목적이 있다. ODA와 FDI의 관계에 대한 이 주제는 많은 경제학자들에 의해 연구되어 왔지만, 아직 합의를 이루지 못한 분야이다. 이 논문은 2000년부터 2019년까지 91개 의 개발도상국 데이터를 이용하여 분석하였다. 전체 데이터를 이용한 추정에서는 ODA와 FDI간 유의미한 관련성을 찾을 수 없었다. 그렇지만 개도국들을 저소득국과 중소득국으로 나누어 분석했을 때는 저소득국에서 ODA가 FDI에 양의 영향을 줌을 알 수 있었다. 중소득국의 경우에는 그러한 영향이 없었다. 이 분석결과는 ‘저소득국 경제개발을 위해 더 많은 ODA가 지원되어야 한다’는 국제사회의 정책방향에 부합한다.

The purpose of this paper is to estimate the effect of Official development assistance (ODA) on foreign direct investment (FDI) inflows in developing countries. This issue has been studied by many economists but there is no consensus yet on the relationship between ODA and FDI. We analyzed the data of 91 developing countries for the period of 2000 to 2019. For the whole data, the relationship is not significant in our estimation results. When we divide the data into low-income and middle-income countries, however, we found a positive effect of ODA on FDI inflows in low-income countries, but no significant result in middle-income countries. This result supports the policy direction of international organizations to provide more ODA funding to low-income countries for economic development.

Under the “New Southern Policy” of the current Korean government, India became an important trade and economic cooperation partner towards promoting better economic cooperation between the two countries. This study investigates the relationship between trade openness and FDI inflows in five major FDI sectors of India. Using CEIC data from 2007 Q1 to 2017 Q3, the study estimates six time-series ARDL models and Granger causality tests with different lags. Among five major FDI sectors, the ARDL estimation results show that trade openness has a significantly positive impact on the automobile and service FDI sector. These two sectors have common features which are efficiency seeking and horizontal FDI flows. Therefore, to ensure the success of the New Southern Policy, a strong channel consisting of an efficiency seeking sector and horizontal FDI flows should be prepared. Granger causality test results show time gaps between the impact of trade openness and FDI flows in India. These results reveal that it takes time for investments and their impact to manifest on international trade in India. Therefore, the Korean government should be patient in obtaining positive results in terms of trading and investing in India through the New Southern Policy.

Although the empirical evidence is inconclusive, the extant research on FDI has shown that political factors such as regime types and political stability may affect FDI inflows. However, the existing statistical literature on the determinants of inward FDI to South Korea tends to ignore the role of political variables, while focusing on a variety of economic factors. Empirical analysis of FDI flows that excludes political variables not only fails to reflect existent theory, it can also incorrectly attribute the impact of other variables. This study seeks to improve upon previous work by systematically examining the effects of both economic and political determinants of FDI inflows in South Korea. Using the annual data covering the time period 1970-2018 and vector auto-regression (VAR) method, the estimation results suggest that a set of political variables, the type and durability of the regime and political instability, have a significant impact on inward FDI. I find that democratic institutions, regime durability, market size, and human capital have a positive association with FDI, that political instability and economic growth have a negative correlation with FDI, and that trade openness, inflation, and exchange rate have little systematic bearing on FDI inflows in South Korea.

This study aims to examine the nexus between economic growth, FDI inflows and energy consumption on a panel of 17 countries using a ‘growth model’ framework and simultaneous-equation models estimated by the generalized method of moments (GMM) over the 1990-2012 period. We also implement these empirical models for 17 countries selected on the basis of data availability. They include: (a) 12 Middle Eastern countries, namely: Saudi Arabia, Qatar, Oman, Kuwait, Lebanon, United Arab Emirates, Iraq, Turkey, Iran, Syria, Jordan and Yemen, (b) 5 North African countries, namely: Egypt, Morocco, Tunisia, Algeria and Libya. Our results indicate that there is a bidirectional causal relationship between FDI inflows and economic growth, as between well as energy consumption and economic growth. Besides, there is a unidirectional causal relationship between energy consumption to FDI inflows for the global panel. This implies that the increase of energy consumption increases the FDI inflows for individual and collective countries.

This paper investigates the relationship between political regimes and Foreign Direct Investment (FDI) inflows to the developing countries for a sample of 134 countries over the 1983-2002 period. Using two categorical measures of regime type and three different measures of FDI, this study finds that, regardless of the measures of regime type, democracies are not significantly associated with either FDI in level or FDI as a ratio to GDP; democracy is positively related to higher level of per capita FDI, but this result is not robust to alternative measures of political regime. Taken as a whole, there is no evidence of a systematic relationship between democracy and FDI inflows. This result suggests that being a democracy does not help attract higher levels of FDI.JEL Classification: F21 F23

The objective of this study is to investigate the effect of economic freedom on foreign direct investment (FDI) in Sub-Saharan Africa (SSA). To this end, we employed a panel data analysis across 41 countries over the period 2000-2020. We used a two-stage least squares (2SLS) estimation method to address potential endogeneity issues. We found that economic freedom plays a crucial role in enhancing FDI inflows in SSA. Specifically, the results suggest that certain dimensions of economic freedom, such as the size of government and the legal system and property rights. Have a positive effect on FDI inflows in SSA. Conversely, components or dimensions like sound money and regulation have a negative impact. Freedom to trade has a positive sign on FDI. Regardless, these effects are statistically insignificant. Based on these outcomes, SSA countries should prioritize consolidating public spending on infrastructure development and enhancing the quality of investments in human capital formation. Additionally, strengthening the legal framework by ensuring the rule of law and a functional justice system that effectively safeguards the rights of investors is also necessary.

Capital inflows have a strong presence that influences destination countries’ development of institutions, which can in turn help resuscitate a stopped economy and re-attract capital that was lost during crises such as the recent public health crisis. While the previous literature emphasizes the mechanism that foreign investors press or even threaten the local government for change, this paper explores empirically whether institutional improvement can be achieved through the channel that host countries voluntarily reform institutions in anticipation of potential investments predicted by the exogenous geographical and cultural characteristics of the recipient countries. Given that countries with better institutional quality can accumulate larger FDI stocks, we still find that the need for more FDI, in contrast to FPI and debt, gives higher incentives to host countries to strategically improve their institutions before seeking capital overseas. Moreover, the predicted FDI exerts more prominent impacts on institutions on constraining elite than those involved in launching a business, enforcing contracts, and protecting properties. The results imply that a long-run plan for upgrading elite constraint institutions is crucial for a post-pandemic FDI reboot.

Existing literature has focused on analyzing various determinants of foreign aid disbursement. From the aid-for-policy framework, however, this paper concentrates on the strategic usage of foreign aid by donor countries to influence recipient countries’ adverse policies. Through foreign aid, donor countries expect to earn favorable policy concessions from recipients to promote their economic interests with FDI. Using a dataset containing 28 sub-Saharan African countries for the period 1990-2021, I find that foreign aid mitigates unfavorable investment conditions of the recipients and it further leads to boosting donor countries’ FDI. This result suggests that foreign aid is used strategically, with its main focus being to increase donors’ economic interests in the region.

This study examines the impact of strengthening employment protection legislation, the structure of collective bargaining (centralization and coordination) and other labor market variables (national levels of unionization, strike levels and tax wedges on labor income) on a country's FDI inflows. Examining 29 OECD nations, our statistical analysis shows that strict EPL, which increases labor market rigidity, is usually associated with lower levels of FDI shares. Japanese investors are more sensitive to employment protection measures in choosing destinations for FDI than others. A 1-percentage-point increase in EPL causes a decrease of about 4.2 percent to Japan's FDI share, compared to the decrease of 2.2 percent that results in the worldwide share. Finally, we discuss the implications of the recent employment protection policies in Korea that focus only on the interests of "inside" labor, neglecting the interests of "outside" labor (unemployed and future labor), as well as reducing FDI inflows. Thus, policies for spending on outside labor and promoting entrepreneurship are necessary for national welfare as well as FDI inflows to increase.

Purpose ? This research investigates the impact of the informal economy on foreign direct investment (FDI) inflows. This work is the first study that has examined this issue in the case of Commonwealth of Independent States (CIS) countries. Design/Methodology/Approach ? We use a fixed-effects regression model with a panel dataset of eight CIS countries spanning 14 years (2002~2015) to shed light on the role of the informal economy in CIS countries as one of the determinants of FDI. Findings ? The results show that as the size of the informal economy increases, FDI inflows decrease, suggesting a new perspective on the informal economy’s impact on FDI, with the empirical evidence revealing a negative relationship between them in CIS countries. Based on the empirical results, it is evident that human capital, extrapolated from secondary school enrollment numbers, and openness to trade are the key components in attracting FDI to CIS countries. Research Implications ? It is clear that the informal economy is a hindrance to attracting FDI, implying that potential foreign investors have concerns about the informal economic system because where their properties cannot be protected in a formal legal system. These results suggest that the governments of CIS countries should reduce the size of their informal economy to create an FDI-friendly environment.

본 논문은 1984년부터 2003년까지 중국과 16개 교역상대국과의 무역에 있어서 중력 모델이 중국의 무역패턴에 잘 적용될 수 있는가를 알아보고자 하였으며, 또한 어떤 변수가 중요한 역할을 하고 있는가를 분석하였다. 분석에 있어서 중력모델의 중요한 변수인 교역국의 경제규모와 교역국간의 거리 이외에 중국의 해외직접투자와 교역상대국의 산업내 무역지수를 포함하여 중국의 무역패턴을 분석하였다. 분석결과에 따르면 중력모델은 중국의 무역패턴을 잘 설명하고 있는 것으로 나타났는데, 이는 중국이 경제규모가 큰 국가 및 거리상으로 가까운 나라들과의 무역규모가 증가하고 있음을 의미한다. 한편 중국의 해외직접투자 규모는 중국의 무역신장에 긍정적인 영향을 주지 못하고 있는 것으로 나타났으나, 환율은 긍정적인 영향을 준 것으로 나타났다. 1990년대 이후 중국은 APEC 국가들과의 무역규모가 증가하고 있으며, 또한 근거리에 있는 국가들과의 무역도 점차 증가하고 있는 것으로 나타났다. 그러나 교역상대국의 산업내 무역지수는 중국의 무역에 큰 영향을 주지 못하고 있는 것으로 나타났다. 교역상대국의 중국에 대한 직접투자의 중요한 요인을 알아보기 위해 중력모델을 응용하여 분석한 결과 중국의 소득과 경제성장률은 FDI 유입에 긍정적인 영향을 주었으며 통계적으로 유의하였다. 반면에 거리는 부정적인 영향을 주었으나 통계적으로 유의하지 않은 것으로 나타났다. 이런 관점에서 아시아 국가의 중국에 대한 FDI의 지속적인 증가는 이들 국가의 높은 경제성장 및 중국과 이들 국가와의 문화적인 공감대(cultural tie)가 큰 영향을 주고 있는 것으로 보인다.

In this study, the gravity model is applied to analyze and identify important factors affecting China's bilateral trade flows. The empirical model uses data for trade between China and sixteen trading partners for the period 1984-2003. In addition to basic variables, new explanatory variables such as foreign direct investment(FDI) and the intra-industry trade(IIT) index of trading partners, are incorporated into the model. The results reveal that both the basic gravity model and the extended model fit China's bilateral trade well. This implies that China tends to trade more with large economies and geographically close countries. However, China's FDI outflow does not positively affect China's trade flows. The results also show that China trades more with APEC countries than with non-APEC countries, providing clear empirical evidence of growing importance of the regional trading agreements. The study also applies the gravity model to the bilateral FDI flows to determine the vital factors that influence FDI inflow for China. The study reveals that China's income and economic growth rate both have significantly positive effects on the FDI inflow in China. Distance shows negative sign but it turns out statistically insignificant. This implies that China's cultural ties with other Asian countries may play a role.

Using time-series and panel data from 1971 to 2005, this paper examines the Granger causality relations between economic growth (using GDP as a proxy), exports, and FDI inflows among major ASEAN economies, including Malaysia, Philippines, Singapore, and Thailand. We first show and compare ASEAN's economic status with other East Asian countries in the context of East Asian Miracle. After reviewing the current literature and testing the properties of individual time-series data, we estimate the VAR of the three variables to find various Granger causality relations for each of the four economies. We found each country has different causality relations, yielding no general rules. We then construct the panel data of the three variables for the four ASEAN economies as a group. We use the fixed effects model approach to estimate the panel data VAR equations for Granger causality tests. The panel data causality results reveal that there are bidirectional causality relations between exports and GDP, and bet ween exports and FDI inflows. But we found no evidence that GDP and FDI inflow are directly related. When these causality relations are combined, however, we found FDI inflows affect GDP indirectly through exports. Our results provide an important policy message that FDI inflows can promote economic growth only under an export promotion regime. Our results also indicate that panel data causality analysis is superior to time series analysis.

Purpose ? This study aimed to analyze the long-term effects of FDI inflows into 16 metropolitan cities and provinces on the economic growth of individual regions, and to compare and analyze differences in regional performance through these estimates. Design/Methodology/Approach ? This study analyzed the impact of FDI flows into 16 metropolitan cities and provinces on regional economic growth by applying the FMOLS model after organizing panel time series data from 1998 to 2021. Findings ? As a result of estimation through the Panel FMOLS model, when RFDI inflows to all metropolitan cities and provinces increased by 1%, GRDP increased by 0.21% on average in the long run. However, 12 individual metropolitan cities and provinces, which were statistically significant, showed different degrees of impact on growth. when RFDI inflows increased by 1%, GRDP showed various estimation results from lowest +0.09% (Ulsan) to the highest +0.93% (Gyeonggi). In addition, Ulsan (-0.12%p), Gangwon (-0.05%p), and Jeju (-0.11%p) fell below the overall average estimates as a result of comparing and analyzing growth differences between the average estimates of all metropolitan cities and provinces, and 12 individual metropolitan cities and provinces. This means that even if there is a positive growth of GRDP due to RFDI inflows, the ripple effect varies considerably between regions. Research Implications ? Metropolitan cities and provinces should promote the growth of GRDP by reorganizing the industrial structure to attract high-tech industries, sharing skilled manpower in the metropolitan economy, and converting to SOC for technological innovation.

본 연구는 외국인직접투자(FDI)와 금융발전이 녹색 총요소생산성(GTFP) 향상에 미치는 영향을 분석하였다. 분석 대상은 2003년부터 2017년까지 중국 30개 성의 데이터를 활용해 Biennial Malmquist Luenberger (BML) 생산성 지수를 구축하여 GTFP를 측정하였다. 이와 함께 본 연구는 FDI와 금융발전이 GTFP에 미치는 영향을 금융발전의 규모와 금융발전의 효율 두 가지 관점에서 고정효과 회귀방법으로 FDI와 금융발전의 상호작용이 GTFP 향상에 미치는 영향을 분석하였다. 더 나아가 지역적 이질성을 분석했다. 실증분석 결과는 다음과 같다. (1) FDI와 금융발전은 지역 GTFP의 향상을 촉진할 수 있으나 지역적 이질성(Heterogeneity)이 존재했다. (2) 금융발전 규모에 비해 금융발전 효율이 GTFP를 향상시키는 영향이 더 컸다. (3) FDI와 금융발전의 상호작용도 GTFP 향상을 촉진할 수 있다.

This study aims to understand the impact of foreign direct investment(FDI) and financial development on the growth of green total factor productivity(GTFP). Therefore, based on the data of 30 Provinces in China from 2003 to 2017, the Biennial Malmquist-Luenberger (BML) Productivity Index is constructed to measure GTFP. At the same time, this study empirically analyzes the impact of FDI and financial development on GTFP from the perspective of financial development scale and financial development efficiency by using the fixed-effect regression method, and focuses on the impact of the interaction between FDI and financial development on the growth of GTFP. Furthermore, regional heterogeneity is also analyzed. The empirical results show that (1) FDI and financial development can promote the growth of regional GTFP, but there is obvious regional heterogeneity. (2) Compared with the scale of financial development, the efficiency of financial development has a more significant effect on promoting GTFP. (3) The interaction between FDI and financial development can also promote the growth of GTFP.