Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size?
The main focus of the paper is the measurement of the potential for externalities related to foreign direct investment. A series of novel proxies are drawn from the Enterprise Survey database of the World Bank-IFC and tested against hypotheses cons...
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| Format: | Publications & Research |
| Language: | English en_US |
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World Bank Group, Washington, DC
2015
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| Online Access: | http://documents.worldbank.org/curated/en/2015/01/23951584/measuring-determinants-backward-linkages-fdi-developing-economies-matter-size http://hdl.handle.net/10986/21440 |
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okr-10986-21440 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
| language |
English en_US |
| topic |
AUTOMOBILE AVAILABILITY OF DATA BENCHMARK BENCHMARKING BRANCH BUSINESS ENVIRONMENT CAPITAL FLOWS CAPITAL FORMATION CAPITAL INFLOWS CAPITAL MOVEMENTS CENTRAL BANK CERTIFICATE CERTIFICATES COMMERCIAL BANK COMMERCIAL BANK LOANS COMMODITIES COMMODITY COMPANY COMPETITIVENESS COMPETITORS CONNECTIVITY CONTRACTUAL ARRANGEMENTS CORRELATION MATRIX CUSTOM CUSTOMS DATA LIMITATIONS DEBT DEFICITS DEMONSTRATION EFFECTS DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIVERSIFICATION DOMESTIC FIRMS DOMESTIC SUPPLIERS ECONOMETRICS ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC INTEGRATION ECONOMIC POLICY ECONOMIC SIZE ECONOMIES OF SCALE EMPLOYMENT ENABLING ENVIRONMENT ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENTREPRENEURS EQUIPMENT EQUITY FLOWS EQUITY INVESTMENTS EXOGENOUS VARIABLES EXPORT PROCESSING ZONES EXPORTS EXTERNALITIES FDI FINANCIAL CRISIS FINANCIAL MARKETS FOREIGN ACQUISITION FOREIGN AFFILIATE FOREIGN AFFILIATES FOREIGN CAPITAL FOREIGN CAPITAL PARTICIPATION FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRM FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTMENT POLICY FOREIGN INVESTOR FOREIGN INVESTORS FOREIGN MARKET FOREIGN OWNERSHIP FOREIGN PARTICIPATION FOREIGN TECHNOLOGIES FOREIGN TECHNOLOGY FOREIGN TRADE FREE TRADE FUTURE RESEARCH GDP GLOBAL ECONOMY GLOBALISATION GLOBALIZATION GROSS FIXED CAPITAL FORMATION GROWTH POTENTIAL GROWTH RATE HOST COUNTRIES HOST COUNTRY HOST ECONOMIES HOST ECONOMY HUMAN CAPITAL INDUSTRIAL DEVELOPMENT INFLATION INSTITUTIONAL FRAMEWORK INTERNATIONAL BUSINESS INTERNATIONAL COMPARISONS INTERNATIONAL ECONOMICS INTERNATIONAL FINANCIAL INTERNATIONAL INVESTMENT INTERNATIONAL TRADE JOINT VENTURE JOINT VENTURES KNOWLEDGE DIFFUSION LICENSES LIQUIDITY LOCAL INDUSTRIES LOCAL INDUSTRY MACROECONOMIC STABILITY MANUFACTURERS MANUFACTURING MANUFACTURING INDUSTRIES MANUFACTURING SECTORS MARKET ENTRY MARKET INFORMATION MARKET SHARE MERGERS MICROECONOMIC ANALYSES MIGRATION MNC MULTINATIONAL MULTINATIONAL COMPANIES MULTINATIONAL CORPORATIONS MULTINATIONALS NATURAL RESOURCES NEW TECHNOLOGIES NEW TECHNOLOGY OPEN ACCESS PARTNERSHIP AGREEMENT PATENTS POLITICAL ECONOMY PORTFOLIO INVESTMENTS POSITIVE EXTERNALITIES PROCUREMENT PRODUCTION COSTS PRODUCTION PROCESS PRODUCTION PROCESSES PRODUCTIVITY PRODUCTIVITY INCREASES PROPERTY RIGHTS R&D REAL GDP RELIABILITY RESULT RESULTS SAVINGS SHAREHOLDERS SUBSIDIARIES SUBSIDIARY SUPPLIER SUPPLY CHAIN TAXONOMY TECHNOLOGY INTENSITY TECHNOLOGY TRANSFER TECHNOLOGY TRANSFERS TIME PERIOD TRADE COMPETITIVENESS TRADE FLOWS TRANSACTION TRANSPORT VALUE ADDED VALUE CHAIN VALUE CHAINS WAGES WEB |
| spellingShingle |
AUTOMOBILE AVAILABILITY OF DATA BENCHMARK BENCHMARKING BRANCH BUSINESS ENVIRONMENT CAPITAL FLOWS CAPITAL FORMATION CAPITAL INFLOWS CAPITAL MOVEMENTS CENTRAL BANK CERTIFICATE CERTIFICATES COMMERCIAL BANK COMMERCIAL BANK LOANS COMMODITIES COMMODITY COMPANY COMPETITIVENESS COMPETITORS CONNECTIVITY CONTRACTUAL ARRANGEMENTS CORRELATION MATRIX CUSTOM CUSTOMS DATA LIMITATIONS DEBT DEFICITS DEMONSTRATION EFFECTS DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIVERSIFICATION DOMESTIC FIRMS DOMESTIC SUPPLIERS ECONOMETRICS ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC INTEGRATION ECONOMIC POLICY ECONOMIC SIZE ECONOMIES OF SCALE EMPLOYMENT ENABLING ENVIRONMENT ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENTREPRENEURS EQUIPMENT EQUITY FLOWS EQUITY INVESTMENTS EXOGENOUS VARIABLES EXPORT PROCESSING ZONES EXPORTS EXTERNALITIES FDI FINANCIAL CRISIS FINANCIAL MARKETS FOREIGN ACQUISITION FOREIGN AFFILIATE FOREIGN AFFILIATES FOREIGN CAPITAL FOREIGN CAPITAL PARTICIPATION FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRM FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTMENT POLICY FOREIGN INVESTOR FOREIGN INVESTORS FOREIGN MARKET FOREIGN OWNERSHIP FOREIGN PARTICIPATION FOREIGN TECHNOLOGIES FOREIGN TECHNOLOGY FOREIGN TRADE FREE TRADE FUTURE RESEARCH GDP GLOBAL ECONOMY GLOBALISATION GLOBALIZATION GROSS FIXED CAPITAL FORMATION GROWTH POTENTIAL GROWTH RATE HOST COUNTRIES HOST COUNTRY HOST ECONOMIES HOST ECONOMY HUMAN CAPITAL INDUSTRIAL DEVELOPMENT INFLATION INSTITUTIONAL FRAMEWORK INTERNATIONAL BUSINESS INTERNATIONAL COMPARISONS INTERNATIONAL ECONOMICS INTERNATIONAL FINANCIAL INTERNATIONAL INVESTMENT INTERNATIONAL TRADE JOINT VENTURE JOINT VENTURES KNOWLEDGE DIFFUSION LICENSES LIQUIDITY LOCAL INDUSTRIES LOCAL INDUSTRY MACROECONOMIC STABILITY MANUFACTURERS MANUFACTURING MANUFACTURING INDUSTRIES MANUFACTURING SECTORS MARKET ENTRY MARKET INFORMATION MARKET SHARE MERGERS MICROECONOMIC ANALYSES MIGRATION MNC MULTINATIONAL MULTINATIONAL COMPANIES MULTINATIONAL CORPORATIONS MULTINATIONALS NATURAL RESOURCES NEW TECHNOLOGIES NEW TECHNOLOGY OPEN ACCESS PARTNERSHIP AGREEMENT PATENTS POLITICAL ECONOMY PORTFOLIO INVESTMENTS POSITIVE EXTERNALITIES PROCUREMENT PRODUCTION COSTS PRODUCTION PROCESS PRODUCTION PROCESSES PRODUCTIVITY PRODUCTIVITY INCREASES PROPERTY RIGHTS R&D REAL GDP RELIABILITY RESULT RESULTS SAVINGS SHAREHOLDERS SUBSIDIARIES SUBSIDIARY SUPPLIER SUPPLY CHAIN TAXONOMY TECHNOLOGY INTENSITY TECHNOLOGY TRANSFER TECHNOLOGY TRANSFERS TIME PERIOD TRADE COMPETITIVENESS TRADE FLOWS TRANSACTION TRANSPORT VALUE ADDED VALUE CHAIN VALUE CHAINS WAGES WEB Sanchez-Martin, Miguel Eduardo De Pinies, Jaime Antoine, Kassia Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| relation |
Policy Research Working Paper;No. 7185 |
| description |
The main focus of the paper is the
measurement of the potential for externalities related to
foreign direct investment. A series of novel proxies are
drawn from the Enterprise Survey database of the World
Bank-IFC and tested against hypotheses considered in the
foreign direct investment literature. Using these proxies,
an econometric assessment of the determinants of backward
linkages in developing economies is presented. The results
show that export-oriented foreign direct investment, wholly
owned subsidiaries (as opposed to joint ventures), and
foreign owned firms relying on foreign technologies are less
likely to develop links with domestic companies. In
addition, the analysis finds that some sectors (food, wood,
auto, and auto-parts) are more prone than others (textiles
and electronics) in developing backward linkages. Apart from
the type of foreign direct investment and sector-specific
characteristics, the size of the host economy matters.
Foreign owned subsidiaries in most service oriented
Caribbean islands buy a low percentage of inputs from
domestic firms. This may be because in small islands there
are not enough local suppliers with sufficient quality and
capacity to meet the demands of multinationals. However, the
paper presents the case of the Dominican Republic, the
largest economy in the Caribbean, which has struggled to
develop backward linkages because of the relative isolation
of special economic zones from the rest of the economy. |
| format |
Publications & Research |
| author |
Sanchez-Martin, Miguel Eduardo De Pinies, Jaime Antoine, Kassia |
| author_facet |
Sanchez-Martin, Miguel Eduardo De Pinies, Jaime Antoine, Kassia |
| author_sort |
Sanchez-Martin, Miguel Eduardo |
| title |
Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| title_short |
Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| title_full |
Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| title_fullStr |
Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| title_full_unstemmed |
Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? |
| title_sort |
measuring the determinants of backward linkages from fdi in developing economies : is it a matter of size? |
| publisher |
World Bank Group, Washington, DC |
| publishDate |
2015 |
| url |
http://documents.worldbank.org/curated/en/2015/01/23951584/measuring-determinants-backward-linkages-fdi-developing-economies-matter-size http://hdl.handle.net/10986/21440 |
| _version_ |
1764448267730419712 |
| spelling |
okr-10986-214402021-04-23T14:04:02Z Measuring the Determinants of Backward Linkages from FDI in Developing Economies : Is it a Matter of Size? Sanchez-Martin, Miguel Eduardo De Pinies, Jaime Antoine, Kassia AUTOMOBILE AVAILABILITY OF DATA BENCHMARK BENCHMARKING BRANCH BUSINESS ENVIRONMENT CAPITAL FLOWS CAPITAL FORMATION CAPITAL INFLOWS CAPITAL MOVEMENTS CENTRAL BANK CERTIFICATE CERTIFICATES COMMERCIAL BANK COMMERCIAL BANK LOANS COMMODITIES COMMODITY COMPANY COMPETITIVENESS COMPETITORS CONNECTIVITY CONTRACTUAL ARRANGEMENTS CORRELATION MATRIX CUSTOM CUSTOMS DATA LIMITATIONS DEBT DEFICITS DEMONSTRATION EFFECTS DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIVERSIFICATION DOMESTIC FIRMS DOMESTIC SUPPLIERS ECONOMETRICS ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC INTEGRATION ECONOMIC POLICY ECONOMIC SIZE ECONOMIES OF SCALE EMPLOYMENT ENABLING ENVIRONMENT ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENTREPRENEURS EQUIPMENT EQUITY FLOWS EQUITY INVESTMENTS EXOGENOUS VARIABLES EXPORT PROCESSING ZONES EXPORTS EXTERNALITIES FDI FINANCIAL CRISIS FINANCIAL MARKETS FOREIGN ACQUISITION FOREIGN AFFILIATE FOREIGN AFFILIATES FOREIGN CAPITAL FOREIGN CAPITAL PARTICIPATION FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN FIRM FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTMENT POLICY FOREIGN INVESTOR FOREIGN INVESTORS FOREIGN MARKET FOREIGN OWNERSHIP FOREIGN PARTICIPATION FOREIGN TECHNOLOGIES FOREIGN TECHNOLOGY FOREIGN TRADE FREE TRADE FUTURE RESEARCH GDP GLOBAL ECONOMY GLOBALISATION GLOBALIZATION GROSS FIXED CAPITAL FORMATION GROWTH POTENTIAL GROWTH RATE HOST COUNTRIES HOST COUNTRY HOST ECONOMIES HOST ECONOMY HUMAN CAPITAL INDUSTRIAL DEVELOPMENT INFLATION INSTITUTIONAL FRAMEWORK INTERNATIONAL BUSINESS INTERNATIONAL COMPARISONS INTERNATIONAL ECONOMICS INTERNATIONAL FINANCIAL INTERNATIONAL INVESTMENT INTERNATIONAL TRADE JOINT VENTURE JOINT VENTURES KNOWLEDGE DIFFUSION LICENSES LIQUIDITY LOCAL INDUSTRIES LOCAL INDUSTRY MACROECONOMIC STABILITY MANUFACTURERS MANUFACTURING MANUFACTURING INDUSTRIES MANUFACTURING SECTORS MARKET ENTRY MARKET INFORMATION MARKET SHARE MERGERS MICROECONOMIC ANALYSES MIGRATION MNC MULTINATIONAL MULTINATIONAL COMPANIES MULTINATIONAL CORPORATIONS MULTINATIONALS NATURAL RESOURCES NEW TECHNOLOGIES NEW TECHNOLOGY OPEN ACCESS PARTNERSHIP AGREEMENT PATENTS POLITICAL ECONOMY PORTFOLIO INVESTMENTS POSITIVE EXTERNALITIES PROCUREMENT PRODUCTION COSTS PRODUCTION PROCESS PRODUCTION PROCESSES PRODUCTIVITY PRODUCTIVITY INCREASES PROPERTY RIGHTS R&D REAL GDP RELIABILITY RESULT RESULTS SAVINGS SHAREHOLDERS SUBSIDIARIES SUBSIDIARY SUPPLIER SUPPLY CHAIN TAXONOMY TECHNOLOGY INTENSITY TECHNOLOGY TRANSFER TECHNOLOGY TRANSFERS TIME PERIOD TRADE COMPETITIVENESS TRADE FLOWS TRANSACTION TRANSPORT VALUE ADDED VALUE CHAIN VALUE CHAINS WAGES WEB The main focus of the paper is the measurement of the potential for externalities related to foreign direct investment. A series of novel proxies are drawn from the Enterprise Survey database of the World Bank-IFC and tested against hypotheses considered in the foreign direct investment literature. Using these proxies, an econometric assessment of the determinants of backward linkages in developing economies is presented. The results show that export-oriented foreign direct investment, wholly owned subsidiaries (as opposed to joint ventures), and foreign owned firms relying on foreign technologies are less likely to develop links with domestic companies. In addition, the analysis finds that some sectors (food, wood, auto, and auto-parts) are more prone than others (textiles and electronics) in developing backward linkages. Apart from the type of foreign direct investment and sector-specific characteristics, the size of the host economy matters. Foreign owned subsidiaries in most service oriented Caribbean islands buy a low percentage of inputs from domestic firms. This may be because in small islands there are not enough local suppliers with sufficient quality and capacity to meet the demands of multinationals. However, the paper presents the case of the Dominican Republic, the largest economy in the Caribbean, which has struggled to develop backward linkages because of the relative isolation of special economic zones from the rest of the economy. 2015-02-13T18:10:19Z 2015-02-13T18:10:19Z 2015-01 http://documents.worldbank.org/curated/en/2015/01/23951584/measuring-determinants-backward-linkages-fdi-developing-economies-matter-size http://hdl.handle.net/10986/21440 English en_US Policy Research Working Paper;No. 7185 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Group, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper |