We consider two channels via which foreign inputs into industrial production may lead to productivity effects. The first one concerns dynamic externalities between firms which share technical and organizational knowledge which is vital for the productivity growth of a particular industry. We...

One of the most outstanding features of the trend toward globalization has been the increased importance of foreign direct investment (FDI) flows around the world. This study estimates the determinant of FDI flows using the gravity equation, controlling for the importance of both the traditional...