Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies

The authors use a new data set on firms in 13 countries of the Southern African Development Community (SADC) and comparators from other regions to identify the benefits and determinants of FDI in this region. Foreign Direct Investment (FDI) has facilitated local development in the SADC. Foreign-owne...

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Main Authors:	Lederman, Daniel, Mengistae, Taye, Xu, Lixin Colin
Format:	Journal Article
Language:	en_US
Published:	Taylor and Francis 2013
Subjects:	FDI foreign direct investment spillovers firm performance exports SADC
Online Access:	http://hdl.handle.net/10986/13379

id	okr-10986-13379
recordtype	oai_dc
spelling	okr-10986-133792021-04-23T14:03:08Z Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies Lederman, Daniel Mengistae, Taye Xu, Lixin Colin FDI foreign direct investment spillovers firm performance exports SADC The authors use a new data set on firms in 13 countries of the Southern African Development Community (SADC) and comparators from other regions to identify the benefits and determinants of FDI in this region. Foreign Direct Investment (FDI) has facilitated local development in the SADC. Foreign-owned firms perform better than domestic firms, are larger, and locate in richer and better-governed countries and in countries with more competitive financial intermediaries. They are also more likely to export than domestic firms and evidence suggests that they might have positive spillover effects on domestic firms. Based on a standard empirical model, the SADC is attracting the inward FDI per capita that the region's level of income would predict. But this means that there are less capital inflows per capita to the region than there are to wealthier parts of the developing world. Moreover, the SADC is attracting less FDI than comparators for reasons that are possibly more fundamental than current income, namely, countries’ past growth record, demographic structure and the quality of physical infrastructure. Interestingly, inward FDI is less sensitive to variation in income within the SADC than in other parts of the world, but is more responsive to changes in country's openness to trade. 2013-05-13T13:52:54Z 2013-05-13T13:52:54Z 2012-10-26 Journal Article Applied Economics 0003-6846 http://hdl.handle.net/10986/13379 en_US Applied Economics;45(25) CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo/ World Bank Taylor and Francis Publications & Research :: Journal Article Publications & Research Southern Africa
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	en_US
topic	FDI foreign direct investment spillovers firm performance exports SADC
spellingShingle	FDI foreign direct investment spillovers firm performance exports SADC Lederman, Daniel Mengistae, Taye Xu, Lixin Colin Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
geographic_facet	Southern Africa
relation	Applied Economics;45(25)
description	The authors use a new data set on firms in 13 countries of the Southern African Development Community (SADC) and comparators from other regions to identify the benefits and determinants of FDI in this region. Foreign Direct Investment (FDI) has facilitated local development in the SADC. Foreign-owned firms perform better than domestic firms, are larger, and locate in richer and better-governed countries and in countries with more competitive financial intermediaries. They are also more likely to export than domestic firms and evidence suggests that they might have positive spillover effects on domestic firms. Based on a standard empirical model, the SADC is attracting the inward FDI per capita that the region's level of income would predict. But this means that there are less capital inflows per capita to the region than there are to wealthier parts of the developing world. Moreover, the SADC is attracting less FDI than comparators for reasons that are possibly more fundamental than current income, namely, countries’ past growth record, demographic structure and the quality of physical infrastructure. Interestingly, inward FDI is less sensitive to variation in income within the SADC than in other parts of the world, but is more responsive to changes in country's openness to trade.
format	Journal Article
author	Lederman, Daniel Mengistae, Taye Xu, Lixin Colin
author_facet	Lederman, Daniel Mengistae, Taye Xu, Lixin Colin
author_sort	Lederman, Daniel
title	Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
title_short	Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
title_full	Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
title_fullStr	Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
title_full_unstemmed	Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies
title_sort	microeconomic consequences and macroeconomic causes of foreign direct investment in southern african economies
publisher	Taylor and Francis
publishDate	2013
url	http://hdl.handle.net/10986/13379
_version_	1764423365935759360

Microeconomic Consequences and Macroeconomic Causes of Foreign Direct Investment in Southern African Economies

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