North‐South foreign direct investment and bilateral investment treaties
Copyright policy )North‐South foreign direct investment and bilateral investment treaties
AbstractBilateral investment treaties (BITs) have become increasingly popular as a means of encouraging foreign direct investment (FDI) from developed to developing countries. We adopt a difference‐in‐difference analysis to deal with the problem of self‐selection when estimating the effects ofBITs onFDIflows from a sample ofOECDcountries to a broader sample of lesser developed countries. Our results indicate that forming aBITwith a developed country significantly increasesFDIinflows to developing countries. We further find that the development of newFDIflows and the reinvigoration of deterioratingFDIrelationships accounts for the majority of the increase inFDIflows due toBITformation.
- Netherlands Institute for Social Research Netherlands
- United Nations University – Maastricht Economic and Social Research Institute on Innovation and Technology Netherlands
- Bond University Australia
- United Nations University Japan
- Maastricht University Netherlands
International Investment; Long-term Capital Movements, endogenous treatment effects, IMPACT, foreign direct investment, FIRMS, Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy, o24 - "Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy", FLOWS, POLITICAL-ECONOMY, Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance, o16 - "Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance", GRAVITY, bilateral agreement, TRADE AGREEMENTS, OECD, developing world, bilateral investment treaties, BITS, f21 - "International Investment; Long-term Capital Movements"
International Investment; Long-term Capital Movements, endogenous treatment effects, IMPACT, foreign direct investment, FIRMS, Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy, o24 - "Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy", FLOWS, POLITICAL-ECONOMY, Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance, o16 - "Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance", GRAVITY, bilateral agreement, TRADE AGREEMENTS, OECD, developing world, bilateral investment treaties, BITS, f21 - "International Investment; Long-term Capital Movements"
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