Essays on the Relationships Between Foreign Direct Investment, International Trade, and Exchange Rate Volatility

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ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (53 download)

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Book Synopsis Essays on the Relationships Between Foreign Direct Investment, International Trade, and Exchange Rate Volatility by : Bedassa Tadesse Ayele

Download or read book Essays on the Relationships Between Foreign Direct Investment, International Trade, and Exchange Rate Volatility written by Bedassa Tadesse Ayele and published by . This book was released on 2003 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Foreign direct investment (FDI) and international trade play key roles in enhancing global technology transfer, fostering economic growth, and the increasing integration of the global economy. A country's market maturity level and export platform status are particularly important in determining the amount of FDI andtrade that a country receives. This dissertation focuses on the host market characteristics, the FDI-trade interaction, and how exchange rate risk affects a nation's bilateral trade volume. The first essay examines whether FDI is a complement or a substitute to the bilateral trade (export sales) and the extent to which FDI-trade relationship is affected by the host's market characteristics. In addition to examining the same problem at a disaggregated industry level, the second essay examines theallocation of industry-specific manufacturing FDI across different host countries. Both essays, respectively, use country- and industry-specific Japanese bilateral trade and outward FDI (establishment counts and values) into geographically and economically diverse host nations. Results from the aggregate country-level analysis show that Japanese FDI and export sales during 1989-1999 were complementary. However, the results are sensitive to host's maturity level and export platform status. Results from industry-level analysis show that the relationship between Japanese manufacturing FDI and trade is industry specific. For example, while Japanese outward FDI complements industry specific export sales in food, beverage and tobacco industries, in wood products, furniture, and basic metal manufacturing industries, it substitutes export sales. The third essay investigates the effects of real exchange rate volatility due to shocks in both the fundamental and the microstructure component of the exchange rate on the volume of imports. Empirical results based on monthly bilateral trade data between the U.S., Canada, Germany and Hong Kong indicate that volatility in exchange rate due to shocks in the microstructure aspect of the exchange market has a trade depressing impact. The effect of volatility inthe fundamental exchange rate on the volume of trade, on the other hand, is mixed, suggesting the possibility that importers of different commodity groups treat the effect of exchange risk in the fundamental component on their trading activities differently.

On the Relationships Among International Trade, Foreign Direct Investment, Real Exchange Rate and Its Volatility

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ISBN 13 :
Total Pages : 262 pages
Book Rating : 4.:/5 (44 download)

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Book Synopsis On the Relationships Among International Trade, Foreign Direct Investment, Real Exchange Rate and Its Volatility by : Daranee Saeju

Download or read book On the Relationships Among International Trade, Foreign Direct Investment, Real Exchange Rate and Its Volatility written by Daranee Saeju and published by . This book was released on 1999 with total page 262 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Foreign Direct Investment, Trade and Exchange Rate Volatility

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Publisher : LAP Lambert Academic Publishing
ISBN 13 : 9783838314914
Total Pages : 172 pages
Book Rating : 4.3/5 (149 download)

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Book Synopsis Foreign Direct Investment, Trade and Exchange Rate Volatility by : Bedassa Tadesse

Download or read book Foreign Direct Investment, Trade and Exchange Rate Volatility written by Bedassa Tadesse and published by LAP Lambert Academic Publishing. This book was released on 2009-10 with total page 172 pages. Available in PDF, EPUB and Kindle. Book excerpt: The desire of firms' to enhance their global presence, diversify their production and the interest of policymakers to augment domestic production with more efficient foreign technology has contributed to a surge in the cross border flow of capital. By taking into account market characteristics such as market maturity and export platform status of Japanese FDI hosts during the 1990s, this dissertation examines the link between FDI, trade and exchange rate volatility. More specifically, the following questions are addressed: What induces multinational firms to reach diverse destinations? Which of the host country characteristics attract investing firms most? Are trade flows among partners related to the volume of FDI flows between them? What does the geographical distribution of FDI reflect: efficiency, technological advances, or liberalization of trade and FDI policies? Given the diminishing role of the traditional FDI driving factors (such as factor abundance and cheap labor), to what extent do market maturity, export platform status and size of the host nations matter in determining the inflow of FDI?

Exchange Rate Flexibility, Volatility and the Patterns of Domestic and Foreign Direct Investment

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Publisher : International Monetary Fund
ISBN 13 :
Total Pages : 38 pages
Book Rating : 4.:/5 (318 download)

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Book Synopsis Exchange Rate Flexibility, Volatility and the Patterns of Domestic and Foreign Direct Investment by : Mr.Joshua Aizenman

Download or read book Exchange Rate Flexibility, Volatility and the Patterns of Domestic and Foreign Direct Investment written by Mr.Joshua Aizenman and published by International Monetary Fund. This book was released on 1992-03 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates the factors determining the impact of exchange rate regimes on the behavior of domestic investment and foreign direct investment (FDI). Producers may diversify internationally in order to increase the flexibility of production. We characterize the possible equilibria in a macro model that allows for the presence of a short-run Phillips curve. It is shown that a fixed exchange rate regime is more conducive to FDI relative to a flexible exchange rate, and this conclusion applies for both real and nominal shocks. If the dominant shocks are nominal (real) we will observe a negative (a positive) correlation between exchange rate volatility and the level of investment.

Essays on Foreign Direct Investment and Exchange Rate

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ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (862 download)

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Book Synopsis Essays on Foreign Direct Investment and Exchange Rate by :

Download or read book Essays on Foreign Direct Investment and Exchange Rate written by and published by . This book was released on 2013 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: It has long been observed that the change in exchange rate of a country is positively correlated with Foreign Direct Investment (FDI) inflow into its border. This thesis provides an explanation of this positive correlation, examines the implied welfare effects of short run FDI flows, and offers policy suggestions. We examine firms' cross-border production location decisions in an open-economy macroeconomic model, in which both the exchange rate and FDI flow are endogenously determined. It is argued that the change in the relative real wage caused by nominal rigidities in wage-setting is the underlying cause of the observed correlation. Furthermore, it is shown that these short run fluctuations in FDI speed up the convergence of the economy back to its long run equilibrium, but further exacerbate the inefficiencies in aggregate employments in both countries. Welfare analysis shows that when monetary volatility is sufficiently high, prohibiting FDI increases world utility. Yet the first best outcome can be achieved if long term FDI is retained, but short run variations in production location is disallowed. The theory predicts that industries characterized by wider practice of unionization and collective wage bargaining, and industries with higher labor intensities of production, should exhibit higher level of exchange rate-FDI correlations. Given that short run firm relocation is shown to magnify business cycle fluctuations, we then analyze how monetary policy can be designed to mitigate the above-mentioned inefficiency. Specifically, we examine the effects of output gap response in a Taylor-type interest rate rule. Previous literature has emphasized that, when real shocks cause the natural level of output to deviate from steady state, responding to output gap causes distortion. We show that when multinationals exist, output gap response is an effective mechanism to discourage temporary firm relocation. We compute and compare the expected world utility under different environment, and conclude that in every situation, a mild output response always improve welfare.

The Impact of Exchange Rate Volatility on U.S. Foreign Direct Investment in Latin America

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Publisher : ProQuest
ISBN 13 : 9780549388029
Total Pages : pages
Book Rating : 4.3/5 (88 download)

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Book Synopsis The Impact of Exchange Rate Volatility on U.S. Foreign Direct Investment in Latin America by : Callye R. M. Masten

Download or read book The Impact of Exchange Rate Volatility on U.S. Foreign Direct Investment in Latin America written by Callye R. M. Masten and published by ProQuest. This book was released on 2008 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The determinants of foreign direct investment (FDI) have been widely examined. Previous studies have shown that exchange rates play a vital role in the analysis and are a major determinant in the flow of FDI. Most research has focused on examining how exchange rate volatility affects the economies of developed nations. However, little research has been done in understanding the impact of exchange rate volatility on FDI flows to Latin America. Developing countries lack the capital that is needed for further growth. Therefore, FDI is important to developing countries, because it allows them to gain the necessary capital. This paper examines the relationship between exchange rate volatility, political institutions and FDI flows into Latin America across two sectors: food processing, and industrial manufacturing. Empirical results show that exchange rate volatility significantly deters the flow of U.S. FDI into Latin America. Other significant economic factors are U.S. interest rates and openness to trade. Conflict and corruption are the political risk factors that have significant impacts on FDI flows. Conclusions from the paper recommend governments in Latin America to implement macroeconomic polices that promote stability, which could help reduce exchange rate volatility and lower inflation.

International Capital Flows

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Publisher : University of Chicago Press
ISBN 13 : 0226241807
Total Pages : 500 pages
Book Rating : 4.2/5 (262 download)

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Book Synopsis International Capital Flows by : Martin Feldstein

Download or read book International Capital Flows written by Martin Feldstein and published by University of Chicago Press. This book was released on 2007-12-01 with total page 500 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent changes in technology, along with the opening up of many regions previously closed to investment, have led to explosive growth in the international movement of capital. Flows from foreign direct investment and debt and equity financing can bring countries substantial gains by augmenting local savings and by improving technology and incentives. Investing companies acquire market access, lower cost inputs, and opportunities for profitable introductions of production methods in the countries where they invest. But, as was underscored recently by the economic and financial crises in several Asian countries, capital flows can also bring risks. Although there is no simple explanation of the currency crisis in Asia, it is clear that fixed exchange rates and chronic deficits increased the likelihood of a breakdown. Similarly, during the 1970s, the United States and other industrial countries loaned OPEC surpluses to borrowers in Latin America. But when the U.S. Federal Reserve raised interest rates to control soaring inflation, the result was a widespread debt moratorium in Latin America as many countries throughout the region struggled to pay the high interest on their foreign loans. International Capital Flows contains recent work by eminent scholars and practitioners on the experience of capital flows to Latin America, Asia, and eastern Europe. These papers discuss the role of banks, equity markets, and foreign direct investment in international capital flows, and the risks that investors and others face with these transactions. By focusing on capital flows' productivity and determinants, and the policy issues they raise, this collection is a valuable resource for economists, policymakers, and financial market participants.

Challenges to Globalization

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Publisher : University of Chicago Press
ISBN 13 : 0226036553
Total Pages : 560 pages
Book Rating : 4.2/5 (26 download)

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Book Synopsis Challenges to Globalization by : Robert E. Baldwin

Download or read book Challenges to Globalization written by Robert E. Baldwin and published by University of Chicago Press. This book was released on 2007-11-01 with total page 560 pages. Available in PDF, EPUB and Kindle. Book excerpt: People passionately disagree about the nature of the globalization process. The failure of both the 1999 and 2003 World Trade Organization's (WTO) ministerial conferences in Seattle and Cancun, respectively, have highlighted the tensions among official, international organizations like the WTO, the International Monetary Fund (IMF), the World Bank, nongovernmental and private sector organizations, and some developing country governments. These tensions are commonly attributed to longstanding disagreements over such issues as labor rights, environmental standards, and tariff-cutting rules. In addition, developing countries are increasingly resentful of the burdens of adjustment placed on them that they argue are not matched by commensurate commitments from developed countries. Challenges to Globalization evaluates the arguments of pro-globalists and anti-globalists regarding issues such as globalization's relationship to democracy, its impact on the environment and on labor markets including the brain drain, sweat shop labor, wage levels, and changes in production processes, and the associated expansion of trade and its effects on prices. Baldwin, Winters, and the contributors to this volume look at multinational firms, foreign investment, and mergers and acquisitions and present surprising findings that often run counter to the claim that multinational firms primarily seek countries with low wage labor. The book closes with papers on financial opening and on the relationship between international economic policies and national economic growth rates.

The Exchange Rate, International Trade and the Balance of Payments

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Publisher :
ISBN 13 :
Total Pages : 338 pages
Book Rating : 4.:/5 (318 download)

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Book Synopsis The Exchange Rate, International Trade and the Balance of Payments by : Reserve Bank of Australia. Economic Group

Download or read book The Exchange Rate, International Trade and the Balance of Payments written by Reserve Bank of Australia. Economic Group and published by . This book was released on 1993 with total page 338 pages. Available in PDF, EPUB and Kindle. Book excerpt:

The Effects of Taxation on Multinational Corporations

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Publisher : University of Chicago Press
ISBN 13 : 0226241874
Total Pages : 338 pages
Book Rating : 4.2/5 (262 download)

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Book Synopsis The Effects of Taxation on Multinational Corporations by : Martin Feldstein

Download or read book The Effects of Taxation on Multinational Corporations written by Martin Feldstein and published by University of Chicago Press. This book was released on 2007-12-01 with total page 338 pages. Available in PDF, EPUB and Kindle. Book excerpt: The tax rules of the United States and other countries have intended and unintended effects on the operations of multinational corporations, influencing everything from the formation and allocation of capital to competitive strategies. The growing importance of international business has led economists to reconsider whether current systems of taxing international income are viable in a world of significant capital market integration and global commercial competition. In an attempt to quantify the effect of tax policy on international investment choices, this volume presents in-depth analyses of the interaction of international tax rules and the investment decisions of multinational enterprises. Ten papers assess the role played by multinational firms and their investment in the U.S. economy and the design of international tax rules for multinational investment; analyze channels through which international tax rules affect the costs of international business activities; and examine ways in which international tax rules affect financing decisions of multinational firms. As a group, the papers demonstrate that international tax rules have significant effects on firms' investment and other financing decisions.

Exchange Rate Economics

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Publisher : Routledge
ISBN 13 : 1134838220
Total Pages : 334 pages
Book Rating : 4.1/5 (348 download)

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Book Synopsis Exchange Rate Economics by : Ronald MacDonald

Download or read book Exchange Rate Economics written by Ronald MacDonald and published by Routledge. This book was released on 2005 with total page 334 pages. Available in PDF, EPUB and Kindle. Book excerpt: ''In summary, the book is valuable as a textbook both at the advanced undergraduate level and at the graduate level. It is also very useful for the economist who wants to be brought up-to-date on theoretical and empirical research on exchange rate behaviour.'' ""Journal of International Economics""

Global Investment Competitiveness Report 2019/2020

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Publisher : World Bank Publications
ISBN 13 : 1464815437
Total Pages : 321 pages
Book Rating : 4.4/5 (648 download)

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Book Synopsis Global Investment Competitiveness Report 2019/2020 by : World Bank Group

Download or read book Global Investment Competitiveness Report 2019/2020 written by World Bank Group and published by World Bank Publications. This book was released on 2020-07-06 with total page 321 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Global Investment Competitiveness Report 2019-2020 provides novel analytical insights, empirical evidence, and actionable recommendations for governments seeking to enhance investor confidence in times of uncertainty. The report's findings and policy recommendations are organized around "3 ICs" - they provide guidance to governments on how to increase investments' contributions to their country's development, enhance investor confidence, and foster their economies' investment competitiveness. The report presents results of a new survey of more than 2,400 business executives representing FDI in 10 large developing countries: Brazil, China, India, Indonesia, Malaysia, Mexico, Nigeria, Thailand, Turkey, and Vietnam. The results show that over half of surveyed foreign businesses have already been adversely affected by policy uncertainty, experiencing a decrease in employment, firm productivity, or investment. Foreign investors report that supporting political environments, stable macroeconomic conditions, and conducive regulatory regimes are their top three investment decision factors. Moreover, the report's new global database of regulatory risk shows that predictability and transparency increase investor confidence and FDI flows. The report also assesses the impact of FD! on poverty, inequality, employment, and firm performance using evidence from various countries. It shows that FDI in developing countries yields benefits to their firms and citizens-including more and better-paid jobs-but governments need to be vigilant about possible adverse consequences on income distribution. The report is organized in S chapters: Chapter 1 presents the results of the foreign investor survey. Chapter 2 explores the differential performance and development impact of greenfield FDI, local firms acquired by multinational corporations {i.e. brownfield FDI), and domestically-owned firms using evidence from six countries. Chapter 3 assesses the impact of FDI on poverty, inequality, employment and wages, using case study evidence from Ethiopia, Turkey and Vietnam. Chapter 4 presents a new framework to measure FDI regulatory risk that is linked to specific legal and regulatory measures. Chapter S focuses on factors for increasing the effectiveness of investment promotion agencies.

Dissertation Abstracts International

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ISBN 13 :
Total Pages : 668 pages
Book Rating : 4.F/5 ( download)

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Book Synopsis Dissertation Abstracts International by :

Download or read book Dissertation Abstracts International written by and published by . This book was released on 2009 with total page 668 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Surprise, Surprise

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Publisher : International Monetary Fund
ISBN 13 : 1475545428
Total Pages : 38 pages
Book Rating : 4.4/5 (755 download)

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Book Synopsis Surprise, Surprise by : Nasha Maveé

Download or read book Surprise, Surprise written by Nasha Maveé and published by International Monetary Fund. This book was released on 2016-10-17 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates possible drivers of volatility in the South African rand since the onset of the global financial crisis. We assess the role played by local and international economic surprises, commodity price volatility, global market risk perceptions, and local political uncertainty. As a measure of rand volatility, the study uses a market-based implied volatility indicator for the rand / U.S. dollar exchange rate. Economic surprises—the difference between market expectations and data prints—are captured by Citi’s Economic Surprise Index which is available for South Africa and its main economic partners. The results suggest that rand volatility is mainly driven by commodity price volatility, and global market volatility, as well as domestic political uncertainty. In addition, economic surprises originating in the United States matter, but not those originating from South Africa, Europe, or China.

American Doctoral Dissertations

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Publisher :
ISBN 13 :
Total Pages : 776 pages
Book Rating : 4.3/5 (91 download)

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Book Synopsis American Doctoral Dissertations by :

Download or read book American Doctoral Dissertations written by and published by . This book was released on 2002 with total page 776 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Global Trends 2040

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Publisher : Cosimo Reports
ISBN 13 : 9781646794973
Total Pages : 158 pages
Book Rating : 4.7/5 (949 download)

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Book Synopsis Global Trends 2040 by : National Intelligence Council

Download or read book Global Trends 2040 written by National Intelligence Council and published by Cosimo Reports. This book was released on 2021-03 with total page 158 pages. Available in PDF, EPUB and Kindle. Book excerpt: "The ongoing COVID-19 pandemic marks the most significant, singular global disruption since World War II, with health, economic, political, and security implications that will ripple for years to come." -Global Trends 2040 (2021) Global Trends 2040-A More Contested World (2021), released by the US National Intelligence Council, is the latest report in its series of reports starting in 1997 about megatrends and the world's future. This report, strongly influenced by the COVID-19 pandemic, paints a bleak picture of the future and describes a contested, fragmented and turbulent world. It specifically discusses the four main trends that will shape tomorrow's world: - Demographics-by 2040, 1.4 billion people will be added mostly in Africa and South Asia. - Economics-increased government debt and concentrated economic power will escalate problems for the poor and middleclass. - Climate-a hotter world will increase water, food, and health insecurity. - Technology-the emergence of new technologies could both solve and cause problems for human life. Students of trends, policymakers, entrepreneurs, academics, journalists and anyone eager for a glimpse into the next decades, will find this report, with colored graphs, essential reading.

Journal of Economic Literature

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ISBN 13 :
Total Pages : 304 pages
Book Rating : 4.:/5 (318 download)

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Book Synopsis Journal of Economic Literature by :

Download or read book Journal of Economic Literature written by and published by . This book was released on 2005-12 with total page 304 pages. Available in PDF, EPUB and Kindle. Book excerpt: