Publication:
Greenfield Foreign Direct Investment and Mergers and Acquisitions : Feedback and Macroeconomic Effects

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dc.contributor.authorCalderón, César
dc.contributor.authorLoayza, Norman
dc.contributor.authorServén, Luis
dc.date.accessioned2013-06-13T21:56:44Z
dc.date.available2013-06-13T21:56:44Z
dc.date.issued2004-01
dc.description.abstractForeign direct investment (FDI) flows to developing countries surged in the 1990s to become their leading source of external financing. This rise in FDI volume was accompanied by a marked change in its composition: investment taking the form of acquisition of existing assets (mergers and acquisitions) grew much more rapidly than investment in new assets ("greenfield" FDI), particularly in countries undertaking extensive privatization of public enterprises. This raises two issues. First, is the mergers and acquisitions boom a one-time effect of privatization, or is it likely to be followed by a rise in greenfield investment? Second, do these two types of FDI have different macroeconomic causes and consequences in relation to aggregate investment and growth? The authors focus on establishing the stylized facts in terms of time precedence between both types of FDI, investment, and growth, using annual data for the period 1987-2001 and a large sample of industrial and developing countries. The authors find that in all samples, higher mergers and acquisitions is typically followed by higher greenfield investment, while the reverse is true only for developing countries. In industrial and developing countries alike, both types of FDI lead domestic investment, but not the reverse. Finally, neither type of FDI appears to precede economic growth in developing or industrial countries, but FDI does respond positively to increases in the growth rate.en
dc.identifierhttp://documents.worldbank.org/curated/en/2004/01/2893049/greenfield-foreign-direct-investment-mergers-acquisitions-feedback-macroeconomic-effects
dc.identifier.doi10.1596/1813-9450-3192
dc.identifier.urihttps://hdl.handle.net/10986/13941
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper; No. 3192
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectAUTOREGRESSION
dc.subjectBALANCE OF PAYMENTS
dc.subjectCAPITAL FLOWS
dc.subjectCAPITAL FORMATION
dc.subjectCAPITAL INFLOWS
dc.subjectCENTRAL BANK
dc.subjectCOMPETITIVE PRESSURE
dc.subjectCOUNTRY GROWTH
dc.subjectDEBT
dc.subjectDEVELOPED COUNTRIES
dc.subjectDEVELOPMENT ECONOMICS
dc.subjectDOMESTIC ECONOMY
dc.subjectDOMESTIC FIRMS
dc.subjectDOMESTIC INVESTMENT
dc.subjectDOMESTIC INVESTORS
dc.subjectECONOMETRIC ANALYSIS
dc.subjectECONOMETRICS
dc.subjectECONOMIC ACTIVITY
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC POLICY
dc.subjectEMPIRICAL ANALYSIS
dc.subjectEMPIRICAL STUDIES
dc.subjectEQUITY FLOWS
dc.subjectEXPENDITURES
dc.subjectEXTERNAL FINANCING
dc.subjectFDI
dc.subjectFINANCIAL MARKETS
dc.subjectFINANCIAL SERVICES
dc.subjectFINANCIAL TRANSFERS
dc.subjectFIXED ASSETS
dc.subjectFIXED CAPITAL
dc.subjectFIXED INVESTMENT
dc.subjectFOREIGN CAPITAL
dc.subjectFOREIGN DIRECT INVESTMENT
dc.subjectFOREIGN ENTRY
dc.subjectFOREIGN FIRMS
dc.subjectFOREIGN INVESTMENT
dc.subjectGDP
dc.subjectGLOBAL DEVELOPMENT FINANCE
dc.subjectGLOBALISATION
dc.subjectGROSS FIXED CAPITAL FORMATION
dc.subjectGROWTH RATE
dc.subjectHOST COUNTRY
dc.subjectHOST ECONOMY
dc.subjectHUMAN CAPITAL
dc.subjectINCOME
dc.subjectINDUSTRIAL COUNTRIES
dc.subjectINDUSTRIAL ECONOMIES
dc.subjectINTEREST RATES
dc.subjectINTERNATIONAL CAPITAL
dc.subjectINTERNATIONAL ECONOMICS
dc.subjectINTERNATIONAL FINANCIAL
dc.subjectINTERNATIONAL TRADE
dc.subjectINVESTMENT FLOWS
dc.subjectLDCS
dc.subjectLIQUIDATION
dc.subjectLIQUIDITY
dc.subjectLOCAL FIRMS
dc.subjectLOCAL MARKETS
dc.subjectMACROECONOMIC ANALYSIS
dc.subjectMANUFACTURING SECTOR
dc.subjectMARKET ENTRY
dc.subjectMARKET INTEGRATION
dc.subjectMERGERS
dc.subjectMONETARY ECONOMICS
dc.subjectMULTIPLIERS
dc.subjectNET INFLOWS
dc.subjectOPEN ECONOMIES
dc.subjectPORTFOLIO
dc.subjectPRODUCTIVITY
dc.subjectPRODUCTIVITY GROWTH
dc.subjectPRODUCTIVITY SPILLOVERS
dc.subjectPUBLIC POLICY
dc.subjectREAL GDP
dc.subjectTECHNOLOGY SPILLOVERS
dc.subjectTECHNOLOGY TRANSFER
dc.subjectTECHNOLOGY TRANSFERS
dc.subjectTIME SERIES
dc.subjectWORLD INVESTMENT
dc.subjectWORLD MARKET
dc.titleGreenfield Foreign Direct Investment and Mergers and Acquisitions : Feedback and Macroeconomic Effectsen
dspace.entity.typePublication
okr.crossref.titleGreenfield Foreign Direct Investment and Mergers and Acquisitions: Feedback and Macroeconomic Effects
okr.date.doiregistration2025-04-10T09:50:06.305881Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2004/01/2893049/greenfield-foreign-direct-investment-mergers-acquisitions-feedback-macroeconomic-effects
okr.globalpracticeTrade and Competitiveness
okr.guid628261468781753575
okr.identifier.doi10.1596/1813-9450-3192
okr.identifier.externaldocumentum000012009_20040210154909
okr.identifier.internaldocumentum2893049
okr.identifier.reportWPS3192
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2004/02/10/000012009_20040210154909/Rendered/PDF/325780wps3192.pdfen
okr.themeAnalysis of economic growth,Macroeconomic management
okr.themeEconomic management
okr.topicInternational Economics and Trade::Foreign Direct Investment
okr.topicInternational Economics and Trade::Trade and Regional Integration
okr.topicEconomic Theory and Research
okr.topicInternational Terrorism and Counterterrorism
okr.topicEnvironmental Economics and Policies
okr.topicPayment Systems and Infrastructure
okr.topicFiscal and Monetary Policy
okr.unitOff of Sr VP Dev Econ/Chief Econ (DECVP)
okr.volume1 of 1
relation.isAuthorOfPublication2c4139d2-7458-5296-9aea-6d3db3e1ae1e
relation.isAuthorOfPublication.latestForDiscovery2c4139d2-7458-5296-9aea-6d3db3e1ae1e
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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