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Foreign entrants and domestic entrepreneurship: Evidence from Vietnam

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  • Chih‐Hai Yang

Abstract

This paper examines the impacts of foreign entrants and international trade on potential entrants in Vietnam. Based on a discrete entry model, estimates show that foreign direct investment (FDI) stimulates more domestic entrants in the short run, while the aggregate effect of FDI varies across FDI types. Horizontal FDI tends to have no impact on local start‐ups while vertical FDI is found to have a positive impact on the inflow of domestic entry for only the backward linkage and not for the forward linkage. Moreover, industries with more exports accommodate more domestic entrants, whereas imports tend to deter domestic start‐ups.

Suggested Citation

  • Chih‐Hai Yang, 2019. "Foreign entrants and domestic entrepreneurship: Evidence from Vietnam," Review of Development Economics, Wiley Blackwell, vol. 23(4), pages 1725-1747, November.
    • Handle: RePEc:bla:rdevec:v:23:y:2019:i:4:p:1725-1747
    DOI: 10.1111/rode.12622
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    Cited by:

    1. Silva, Pedro Mendonça & Moutinho, Victor Ferreira & Moreira, António Carrizo, 2022. "Do social and economic factors affect the technical efficiency in entrepreneurship activities? Evidence from European countries using a two-stage DEA model," Socio-Economic Planning Sciences, Elsevier, vol. 82(PB).
    2. Ya‐Po Yang & Ying‐Yi Tsai & Su‐Ying Hsu, 2021. "Technology licensing, entry mode, and trade liberalization," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 834-853, May.
    3. Quang Hoan Truong & Van Chung Dong, 2023. "Impacts of FDI Presence and Product Sophistication on the Demand for Skilled and Unskilled Labour: Evidence from SMEs in Viet Nam," Working Papers DP-2022-40, Economic Research Institute for ASEAN and East Asia (ERIA).
    4. Quang Hoan Truong & Van Chung Dong, 2021. "Spillover Effects of Foreign and Domestic Exporting Firms on Export Decisions of Local Manufacturing Firms: Evidence from Viet Nam," Working Papers DP-2021-43, Economic Research Institute for ASEAN and East Asia (ERIA).
    5. Li, Zhaohua & Pang, Suqin & Zhu, Zhiyun, 2024. "The impact of pilot free trade zones on entrepreneurship: Evidence from a quasi-natural experiment in China," Socio-Economic Planning Sciences, Elsevier, vol. 92(C).

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