The paper analyses the “feedback effect” of Foreign Direct Investment (FDI) on Total Factor Productivity (TFP) growth in emerging economies via technology spillovers across borders. We study the effect of R–D spillovers resulting from outward FDI flows from 18 emerging economies into 34 OECD countries over the 1990-2010 period, comparing the impact with that of spillovers resulting from inward FDI flows. The result confirms that FDI enhances productivity growth; however the impact is much larger when R-D-intensive developed countries invest in the emerging economies than the other way round. Country-specific bilateral elasticities also support this outcome.
JEL classification: F210, F430, F620, O470. Keywords: Outward FDI, Inward FDI, Reverse technology spillovers, Total factor productivity. Suggested Citation. CorrectionsAll material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oec:ecokac:5jxx56vcxn0n. See about how to correct material in RePEc.For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact:.
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Foreign Direct Investment (FDI) FDI is a category of cross-border investment in which an investor resident in one Member State establishes a lasting interest in and significant degree of influence over (ownership of 10% or more of the voting power) a business resident in another.
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