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What happens to FDI spillovers when input-output tables go granular?

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  • Robert Genthner

    (University of Goettingen)

Abstract

Multinational enterprises affect the productivity of domestic firms through FDI spillovers, especially when these firms use similar technology. The impact of spillovers varies with the technological distance between industries. More granular measurement of trade linkages across industries allows for the estimation of an additional intra-sectoral vertical component within two-digit sectors, which was part of the aggregated horizontal spillover effect before. Using Indonesian firm data reveals substantial effect heterogeneity. Horizontal spillovers within the same three-digit industry are negative, while intra-sectoral vertical spillovers across industries are positive and large in magnitude.

Suggested Citation

  • Robert Genthner, 2021. "What happens to FDI spillovers when input-output tables go granular?," Economics Bulletin, AccessEcon, vol. 41(3), pages 2099-2105.
    • Handle: RePEc:ebl:ecbull:eb-21-00680
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    References listed on IDEAS

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    Cited by:

    1. Genthner, Robert & Kis-Katos, Krisztina, 2022. "Foreign investment regulation and firm productivity: Granular evidence from Indonesia," Journal of Comparative Economics, Elsevier, vol. 50(3), pages 668-687.

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    More about this item

    Keywords

    FDI; spillovers; aggregation; Indonesia;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics

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