In this paper I analyze the impact of increasing government infrastructure investment by using existing large foreign exchange reserves in a fully optimizing model matching the Chinese economy. Even though the private investment falls in the nontradable sector, real expenditure and money balance decrease in the short run, the infrastructure investment greately enhances the efficiency and produc...

A model of inward foreign direct investment for Australia is estimated. Foreign direct investment is found to be positively related to economic and productivity growth and negatively related to foreign portfolio investment, trade openness, the exchange rate and the foreign real interest rate. Foreign direct investment is found to be a substitute for both portfolio investment and trade in goods ...

Using a small open economy framework, we model the composition of capital inflows as the equilibrium outcome of emerging market firms’ financing decisions. We show that debt limits, equity issuing costs, and foreign direct investment search costs generate a financing premium and that the ”cheapest” source of financing depends on the phase of the business cycle and past financing decisions. The ...

The model and related empirical examination in this paper demonstrate one reason why previous studies document both positive and negative correlations between exchange rate volatility and observed levels of foreign direct investment. Using a simple model of cross-border mergers and acquisitions, it argues that the source of the volatility is important in resolving the puzzle. An empirical analy...

Relying upon a rich and unique panel of Hungarian firms over 7 years, from 1992 up to 1998, this paper estimates simultaneously TFP, Total Factor Productivity, identified as efficiency, and the parameters of a model where investment depends upon internal funds, wages, and sales, as in Prasnikar J. and Svejnar J. (2000). It shows that while real investment is higher in foreign firms, the improve...

In the 13 years preceding 1995, foreign direct investment in the U.S. forest industry increased 54 percent, but the U.S. direct investment in forest industry abroad nearly doubled. The forest industry's share of total foreign investment in the U.S. manufacturing sector declined, but its share of foreign investment abroad increased. During the same period, the U.S. forest industry attracted only...

this paper concentrates on investigating the effect of monetary instruments on macroeconomic variables using structural model over the period 1981- 2006. the main results of simulation show that decrease in the interest rate, increases investment but it's effect on production (gdp) is negligible. this weak effect is probably due to some factors such as, the introduction of some new project...

With few exceptions, the empirical literature on foreign direct investment (FDI) continues to be gender-blind. This paper contributes to filling this gap by assessing the importance of gender inequality in education as a determinant of FDI. We estimate a standard gravity model on bilateral FDI flows which is augmented by educational variables, including different measures of gender inequality i...

Foreign direct investment (FDI) brings host countries capital, productive facilities, and technology transfers, as well as new jobs and management expertise. Thus, it is important to understand the basic reasons for FDI inflow and make clear what gains from FDI are. In the present paper, based on theoretical findings we formulate clear message stating that inflow of FDI does not need to be expl...

foreign direct investment (fdi) plays a crucial role in the economic literature, especially in developing countries. it is also an important factor for policy makers to analyze the relation between foreign direct investment and other important economic variables. one of these variables is export which is always mentioned in iran's economic development programs. in this study, the relation betwe...