|
iDEA: Drexel E-repository and Archives >
Drexel Academic Community >
Bennett S. LeBow College of Business >
Department of Economics & International Business >
Faculty Research and Publications (Economics & International Business) >
Information technology and bilateral FDI: theory and evidence
Please use this identifier to cite or link to this item:
http://hdl.handle.net/1860/1838
|
| Title: | Information technology and bilateral FDI: theory and evidence |
| Authors: | Jeon, Bang Nam
Tang, Linghui
Zhu, Lei |
| Keywords: | Communication cost
FDI
Distance |
| Issue Date: | Dec-2005 |
| Publisher: | Center for Intenational Economics Sejong Institution |
| Citation: | Journal of Economic Integration, 20(4): pp. 613-630. |
| Abstract: | This paper investigates the impact of communication cost on the FDI activities of multinational corporations (MNCs). First, we provide a theoretical foundation for a gravity-type FDI model, which shows that physical distance and communication technology are important determinants of FDI activities. Second, we apply the IT-augmented gravity model to bilateral FDI data for a total of 47 OECD and non-OECD countries from 1980 to 1997 and find that distance is negatively related to inward FDI stocks while the growth of IT, measured by teledensity and celldensity, has encouraged FDI significantly. The impact is found to be more prominent on FDI from G7 countries to OECD countriesthan to non-OECD countries, and more prominent in the 1990s than in the 1980s. Moreover, IT plays a more effective role by reducing communication cost when distance is beyond a threshold range. |
| URI: | http://hdl.handle.net/1860/1838 |
| Appears in Collections: | Faculty Research and Publications (Economics & International Business)
|
Items in iDEA are protected by copyright, with all rights reserved, unless otherwise indicated.
|
www.drexel.edu
