The rapid rise in global fragmentation - foreign investment, global supply chains, and 'production sharing' - is fundamentally reshaping the multilateral trading system. This paper uses a simple economic modeling framework to understand how the global fragmentation phenomenon may reshape the...

In this paper, we address in more detail the question raised in Wacker (2011b): why does foreign direct investment (FDI) generally have a positive impact on developing countries' terms of trade except in the case of South Asia? After arguing that such a negative relationship is generally...

We examine and compare the effects of greenfield FDI and cross-border mergers and acquisitions (M&As) on total factor productivity (TFP) in developed and developing host countries of FDI. Using panel data for up to 123 countries over the period from 2003 to 2011, we find that greenfield FDI has...

Undoubtedly, poverty reduction has become a front-burner issue in development and business agenda. Since its announcement and defense by its advocates as a potent weapon against poverty, the Bottom of the Pyramid (BoP) concept has been bedeviled by controversies. A major controversy is whether...

This paper extends the model developed by Krugman and Taylor (1978) to take into account interesting features of the evolving structure of global trade. The growing presence of transnational production chains and differential pricing behaviour of exports destined for industrial and developing...

Many developing countries have adopted investor-friendly policies in recent years in order to attract export-oriented foreign direct investment (FDI). The effects of these policies on the external accounts have been largely ignored. This paper endogenizes FDI inflows in a structuralist general...

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...

Der Beitrag analysiert die internationalen Produktionsverlagerungen und Investitionsverflechtungen in der Automobilindustrie, um die These zu überprüfen, dass es selbst bei der Herstellung relativ wissensund technologieintensiver Güter zu einem nachdrängenden Wettbewerb aus Ländern mit...

We employ interactive quantile regressions to assess conditional linkages between foreign aid, iron ore exports and terrorism from a panel of 78 developing countries for the period 1984-2008. The following main findings are established. First, it is primarily in the countries with the highest...

Foreign investment is often constrained by two forms of political risk: expropriation and corruption. We examine the role of government corruption in foreign direct investment (FDI) when contracts are not fully transparent and investors face the threat of expropriation. Using a novel dataset on...