Author: Ray BarrellPublisher:
ISBN:
Category : Economics
Languages : en
Pages : 22
Book Description
Foreign Direct Investment and Exchange Rate Uncertainty in Imperfectly Competitive Industries
Author: Ray BarrellPublisher:
ISBN:
Category : Economics
Languages : en
Pages : 22
Book Description
Exchange rate uncertainty and direct foreign investment
Author: Françoise B. NicolasPublisher:
ISBN:
Category :
Languages : fr
Pages : 225
Book Description
Vers Under Imperfect Competition and Foreign Direct Investment
Author: Publisher: World Bank Publications
ISBN: 6100112140
Category :
Languages : en
Pages : 47
Book Description
Foreign Direct Investment in Industrial R&D and Exchange Rate Uncertainty in the UK
Author: Bettina BeckerPublisher:
ISBN:
Category : Economics
Languages : en
Pages : 20
Book Description
Strategic Foreign Direct Investment and Exchange-Rate Uncertainty
Author: Hongmo SungPublisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
We investigate how exchange-rate uncertainty affects the foreign direct investment decision of a risk-neutral multinational firm (MNF). We assume the firm can open plants, each with decreasing average costs, in two different countries. Under certainty, the MNF would open only one plant. We demonstrate that with sufficient exchange-rate volatility, the firm can increase expected profits by opening several plants. We also show that if the MNF faces a competitor in the foreign market, the exchange risk, by inducing the MNF to open plants in both markets, may prevent entry by the local competitor.
EXCHANGE RATE AND FOREIGN DIRECT INVESTMENT: AN IMPERFECT CAPITAL MARKETS APPROACH
Author: Kenneth A. FROOTForeign Direct Investment, Exchange Rate Variability and Demand Uncertainty
Author: Linda S. GoldbergInternational Firm Investment under Exchange Rate Uncertainty
Author: Alexandre JeanneretPublisher:
ISBN:
Category :
Languages : en
Pages : 44
Book Description
This paper proposes a real options theory to explore the effect of exchange rate uncertainty on foreign direct investment. Firms face the choice between serving foreign markets through exports and investing abroad to relocate production. The model predicts that the most productive firms invest abroad when exchange rate volatility is low and export otherwise, whereas the least productive firms invest abroad when volatility is high. The aggregation over heterogeneous firms produces a negative and non-linear relation between exchange rate uncertainty and total international investment. An analysis of 75 developed and emerging economies over the period 1996-2012 provides empirical support for the model's prediction.
The Impact of Exchange Rate Uncertainty on Foreign Direct Investment in the United States
Author: William B. Z. VuoksonThe Impact of Exchange Rate Volatility on U.S. Foreign Direct Investment in Latin America
Author: Callye R. M. MastenPublisher: ProQuest
ISBN: 9780549388029
Category : Foreign exchange rates
Languages : en
Pages :
Book Description
The determinants of foreign direct investment (FDI) have been widely examined. Previous studies have shown that exchange rates play a vital role in the analysis and are a major determinant in the flow of FDI. Most research has focused on examining how exchange rate volatility affects the economies of developed nations. However, little research has been done in understanding the impact of exchange rate volatility on FDI flows to Latin America. Developing countries lack the capital that is needed for further growth. Therefore, FDI is important to developing countries, because it allows them to gain the necessary capital. This paper examines the relationship between exchange rate volatility, political institutions and FDI flows into Latin America across two sectors: food processing, and industrial manufacturing. Empirical results show that exchange rate volatility significantly deters the flow of U.S. FDI into Latin America. Other significant economic factors are U.S. interest rates and openness to trade. Conflict and corruption are the political risk factors that have significant impacts on FDI flows. Conclusions from the paper recommend governments in Latin America to implement macroeconomic polices that promote stability, which could help reduce exchange rate volatility and lower inflation.