FDI Flows to Asia : Did the Dragon Crowd Out the Tigers?

Author/Editor:

Benoît Mercereau

Publication Date:

September 1, 2005

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

China's dramatic success in attracting foreign direct investment (FDI) has raised concerns that it has success diverted FDI from other countries in Asia. We develop a new methodology to estimate crowding out, and we use it to investigate the impact of China's emergence on FDI flows to Asia using data from 14 Asian economies from 1984 to 2002. The results suggest that China did not have much impact on FDI to other countries. In particular, lowincome economies, which compete with China for low-wage investment, and countries with low levels of education or scientific development do not seem to have been especially affected.

Series:

Working Paper No. 05/189

Subject:

English

Publication Date:

September 1, 2005

ISBN/ISSN:

9781451862089/1018-5941

Stock No:

WPIEA2005189

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

30

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