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Can Foreign Direct Investment Promote Exports in Slovakia?

In: Ekonomický časopis/Journal of Economics, vol. 67, no. 2
Zheng-Zheng Li - Chi-Wei Su - Ran Tao - Oana-Ramona Lobonţ

Details:

Year, pages: 2019, 135 - 156
Language: eng
Keywords:
foreign direct investment, exports, bootstrap rolling window, EU accession; JEL Classification: C32, F14, F21
Article type: Vedecký článok
Document type: PDF
About article:
In this paper, we investigate whether the knowledge capital model (Carr Markusen and Maskus, 2001) is satisfied in Slovakia by applying the bootstrap rolling window subsample test to examine the causal relationship between foreign direct investment (FDI) and exports (EX). This method provides more accurate evidence of a connection between these two variables considering structural changes. The empirical results show a positive correlation between FDI and EX and support the vertical FDI in the knowledge capital model in most sample periods. Specifically, when FDI is rising, EX increase accordingly, and vice versa. In addition, FDI exerted a negative effect on EX in 2011, which is attributable to the relative state of the situation at home and abroad. The findings illustrate that FDI and EX benefit from the free economic institution reforms and inexpensive resources. Therefore, the Slovakian government should improve tax reforms and maintain the stability of legislation to achieve mutual promotion between FDI and EX.
How to cite:
ISO 690:
Li, Z., Su, C., Tao, R., Lobonţ, O. 2019. Can Foreign Direct Investment Promote Exports in Slovakia?. In Ekonomický časopis/Journal of Economics, vol. 67, no.2, pp. 135-156. 0013-3035.

APA:
Li, Z., Su, C., Tao, R., Lobonţ, O. (2019). Can Foreign Direct Investment Promote Exports in Slovakia?. Ekonomický časopis/Journal of Economics, 67(2), 135-156. 0013-3035.
About edition:
Publisher: Ekonomický ústav SAV a Prognostický ústav CSPV SAV
Published: 17. 5. 2019