Investment promotion agencies: do they work?

In this paper, we examine the role of investment promotion agencies (IPAs) in promoting outward FDI from Japan and Korea. Looking at two home countries enables us to control for both country-pair time-invariant characteristics and host country time-varying characteristics. Our empirical results suggest that home-country IPAs tend to be more effective in promoting outward FDI in politically risky host countries. However, this finding depends on whether the home-country firm is listed or unlisted. More specifically, we find that the positive effect of home country IPAs on outward FDI in politically risky countries is limited to unlisted home- country firms, which are widely assumed to be less competitive and productive.

FDI and investment barriers in developing economies

Does investment liberalization in developing economies affect FDI decisions differently across individual firms? To address this question, we simulate the response of individual firms to reductions in investment costs across developing economies. We explore two policy experiments: elimination of setup-procedure requirements for foreign investors and a reduction in corporate tax rates on foreign-owned multinationals. We find that a relaxing of discriminatory foreign investment procedures induces middle productive firms to increase their entry and production in developing economies substantially, but the most productive firms to expand moderately. Multinationals expand their entry and production in developing economies more substantially following a decline in entry barriers than following a decrease in corporate tax rates.

The impact of foreign firms on industrial productivity : evidence from Japan

With a newly constructed dataset on foreign firms in Japan for the period 1995-2008 from firm-level surveys, this paper estimates the impact of foreign firms on industrial productivity at the regional level. A Bayesian-model averaging approach is taken to account for model uncertainty resulting from various linkages between foreign firms and domestic industries. The results show that the foreign firms may contribute to industrial efficiency directly through their above-average productivity and indirectly through positive spillovers in intra-industry and local backward linkages. Forward linkages with foreign firms may have a negative impact on industrial productivity. However, these impacts depend on the nationality and entry mode of foreign investors. Aggregating foreign firms may mask their distinctive impacts on productivity.

Do international flights promote FDI? : the role of face-to-face communication

Air transportation facilitates face-to-face interactions across borders for the spatial expansion of manufacturing production. I investigate the impact of international flights on FDI entry by Japanese firms. I find that FDI entry significantly increases with the weekly frequency of flights from Japan, and the positive impact increases with a proxy for an intensity of face-to-face communication between the parent firm and foreign affiliate. The results are robust to estimation methods, additional control variables, and definitions of face-to-face communication. Thus, the results suggest that flights encourage FDI entry through a reduction in face-to-face communication costs.

Greenfield shopping center development. The integration between environmental features, building design and investment analysis at the decision making stage

The Shopping centre is a long term investment in which Greenfield development decisions are often taken based on risks analysis regarding construction costs, location, competition, market and an expected DCF. Furthermore, integration between the building design, project planning, operational costs and investment analysis is not entirely considered by the investor at the decision making stage. The absence of such information tends to produce certain negative impacts on the future running costs and annual maintenance of the building, especially on energy demand and other occupancy expenses paid by the tenants to the landlord. From the investor´s point of view, this blind spot in strategy development will possibly decrease their profit margin as changes in the occupancy expenses[ ] have a direct outcome on the profit margin. In order to try to reduce some higher operating cost components such as energy use and other utility savings as well as their CO2 emissions, quite a few income properties worldwide have some type of environmental label such as BREEAM and LEED. The drawback identified in this labelling is that usually the investments required to get an ecolabel are high and the investor finds no direct evidence that it increases market value. However there is research on certified commercial properties (especially offices) that shows better performance in terms of occupancy rate and rental cost (Warren-Myers, 2012). Additionally, Sayce (2013) says that the certification only provides a quick reference point i.e. the lack of a certificate does not indicate that a building is not sustainable or efficient. Based on the issues described above, this research compares important components of the development stages such as investments costs, concept/ strategy development as well as the current investor income and property value. The subjects for this analysis are a shopping centre designed with passive cooling/bioclimatic strategies evaluated at the decision making stage, a certified regional shopping centre and a non-certified standard regional shopping centre. Moreover, the proposal intends to provide decision makers with some tools for linking green design features to the investment analysis in order to optimize the decision making process when looking into cost savings and design quality.

Simulation Results on the Impact of Changes in the Main EU Policy Tools on Farm Investment Behaviour. Factor Markets Working Document No. 56, June 2013

This paper completes the comparative analysis of the investment demand behaviour, of a sample of specialised arable crop farms, for farm buildings and machinery and equipment, as a function of the different types and levels of Common Agricultural Policy support, in selected European Union Member States. This contribution focuses on their quantitative interdependence calculating the relevant elasticity measures. In turn, they constitute the methodological tool to simulate the percentage expected change in average net investment levels associated to the implementation of the, recently proposed and currently under discussion, reductions in the Pillar I Direct Payments disbursed under the Common Agricultural Policy. Evidence suggests a statistically significant elastic and inelastic relationship between both types of subsidies and the investment levels for both asset classes in Germany and Italy, respectively. An elastic dependence of investment in farm buildings on decoupled subsidies exists in Hungary while changes in the level of coupled payments appear to translate into less than proportional changes in the demand for both farm buildings and machinery and equipment in France. Coupled payments appear to influence the UK demand for both asset classes in an elastic manner while decoupled support seems to induce a similar effect on investment in machinery and equipment. Since the currently discussed Common Agricultural Policy reform options imply, almost exclusively, a reduction in the level of support granted through Direct Payments, simulated effects were expected to reveal a worsening of the farm investment prospects for both asset types (i.e., a larger negative investment or a smaller positive one). The actual evidence largely respects this expectation with the sole exception of investment in machinery and equipment in France and Italy reaching smaller negative or larger positive levels irrespectively of the magnitude of the implemented cuts in Direct Payments.

Financing European Defence: Time to Call the European Investment Bank? IES Policy Brief Issue 2014/05/July 2014

Summary. Financing research and development programmes have never been more expensive in Europe. Defence budgets are on the wane, international competition is fierce and high-end technologies are increasingly expensive. Europe’s defence-industrial base is under significant strain, and options are needed to fund elements of a sector that is still crucial to Europe’s security and industry. This Policy Brief argues that the European Investment Bank could play a much greater role in Europe’s defence sector. As a public-private institution the Bank could serve as a life-line to defence R&D, dual-use projects and support for SMEs, especially where regional clusters are involved.

Restructuring the Greek banking sector with an empty purse. CEPS Commentary, 13 July 2015

Greek banks are close to collapse, even if a new bail-out programme is agreed soon. The deterioration of the economy means that their fragile capital position is deteriorating further. In this CEPS Commentary, Daniel Gros observes that any new programme needs to include recapitalisation, comprising possibly a bail-in and restructuring to get the banking system working again. With only a small part of the assets unencumbered and a government with empty pockets, the depositors might have to take a large part of the burden. As private investors are unlikely to participate in a recapitalisation, foreign official funds will be needed. A direct equity investment by the EIB or the EBRD could be used to transfer control rights, and special ESM bonds could be used to provide additional capital without entailing additional risk to the creditors

Don’t Go Protectionist! Trade and Investment Relations between the EU and China. Asia Policy Brief 2012/1, June 2012

The European Parliament has proposed the creation of a body to monitor foreign – in particular Chinese – investment in the EU. The initiative, driven by fears of unfair competition and a hidden political agenda behind Chinese investments, should be rejected. There are better ways to promote openness and transparency in Sino-European economic relations.

Investment in Peru; basic information for United States businessmen.

Mode of access: Internet.

Investment in Central America; basic information for United States businessmen.

Bibliography: p.271-273.

Investment in Cuba; basic information for United States businessmen.

Bibliographical footnotes.

Oversight hearings on U.S. international monetary policies : hearings before the Subcommittee on International Trade, Investment, and Monetary Policy of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, Ninety-seventh Congress, first session, November 4, and 5, and December 10, 1981.

Item 1013-A, 1013-B (microfiche).

The Eurocurrency market control act of 1979 : hearings before the Subcommittee on Domestic Monetary Policy and the Subcommittee on International Trade, Investment, and Monetary Policy of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, Ninety-sixth Congress, first session, on H.R. 3962 ... June 26, 27, and July 12, 1979.

"Serial no. 96-23."

Investment in Nigeria; basic information for United States businessmen.

Bibliography: p. 181-182.