Do Overseas investments create or replace trade? New insights from a macro-sectoral study on Japan
TL;DR: This paper investigated the relationship between outward foreign direct investment (FDI) and exports and imports from Japan, employing an augmented standard gravity model and found that the complementary relationship between FDI and trade is dominant in Japanese manufacturing, especially in the food and beverages, electric machinery, primary metals, and precision machinery sectors.
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Abstract: This paper investigates the relationship between outward foreign direct investment (FDI) and exports and imports from Japan, employing an augmented standard gravity model. Several econometric techniques, including the Gamma Pseudo Maximum Likelihood estimator, are used to rectify possible problems of heteroskedasticity and zero trade flows inherent in the estimation of gravity models of trade. The major finding is that outward FDI is trade enhancing for the Japanese manufacturing industry. However, we find that whether outward FDI creates or replaces trade depends on the industry under scrutiny. Our results indicate that the complementary relationship between FDI and trade is dominant in Japanese manufacturing, especially in the food and beverages, electric machinery, primary metals, and precision machinery sectors. We find also that Japanese overseas investments substitute for imports of chemical products, and for both exports and imports of general machinery.
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Sraffa's and Wittgenstein's Crossed Influences: Forms of Life and Snapshots
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Outward foreign direct investment and intermediate goods exports : e vidence from the usa
Kemal Türkcan
- 12 May 2008
TL;DR: The authors examined the relationship between outward FDI stocks and final and intermediate goods exports in the US economy over the period from 1989 to 2003 using finely disaggregated trade data, the panel data estimation indicates that the inward FDI stock and output are complementary activities, verifying the hypothesis that fragmentation plays an important role in explaining intra-firm trade between different plants within the same multinational companies.
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Residents' Inuence on the Adoption of Environmental Norms in Tourism
TL;DR: In this paper, the authors considered the case of a tourism service provider, in a situation of monopoly, facing heterogeneous demand and located in a destination inhabited by a population of residents, more or less active in their resistance to tourism activities.
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Modeling Luxury Consumption: An Inter-Income Classes Study of Demand Dynamics and Social Behaviors
TL;DR: In this paper, a model of luxury preference formation is developed, in which preferences evolve endogenously and under which conditions they observe a specialization of consumption by social classes, and the impact of "Veblen e ect" on consumption behaviors.
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Japanese exports, MNC affiliates, and rivalry for export markets
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