Author : Jannick Damgaard,Thomas Elkjaer
Publisher : International Monetary Fund
Page : 25 pages
File Size : 49,6 Mb
Release : 2017-11-17
Category : Business & Economics
ISBN : 9781484329658
The Global FDI Network: Searching for Ultimate Investors by Jannick Damgaard,Thomas Elkjaer Pdf
This paper addresses three types of geographical decoupling in foreign direct investment (FDI), i.e., challenges when using traditional FDI data as a proxy for real economic integration between economies: (i) large bilateral asymmetries between inward and outward FDI, (ii) the role of special purpose entities (SPEs), and (iii) the effect of moving from immediate counterpart to ultimate investing economy (UIE). A unique global FDI network is estimated, where SPEs are removed and FDI positions are broken down by the UIE. Total inward FDI in the new network is reduced by one-third, and financial centers are less dominant.