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Foreign Direct Investment, Corporate Finance, and the Life Cycle of Investment

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Abstract

This article discusses the effect of foreign direct investment on the corporate sector in the Czech Republic. The analysis uses subaggregated corporate data from a unique Deutsche Bundesbank database containing an almost complete sample of German enterprises that invested in the Czech Republic between 1996 and 2004. Attention was given to two issues: the role of intra-group financing in foreign-owned corporations and the life cycle of direct investments.

Suggested Citation

  • Adam GERŠL & Michal HLAVACEK, 2007. "Foreign Direct Investment, Corporate Finance, and the Life Cycle of Investment," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 57(9-10), pages 448-464, October.
    • Handle: RePEc:fau:fauart:v:57:y:2007:i:9-10:p:448-464
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    File URL: http://journal.fsv.cuni.cz/storage/1087_fau_9_10_2007_00000036.pdf
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    References listed on IDEAS

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    1. Rajan, Raghuram G & Zingales, Luigi, 1995. "What Do We Know about Capital Structure? Some Evidence from International Data," Journal of Finance, American Finance Association, vol. 50(5), pages 1421-1460, December.
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    1. Ľubomír Darmo & Marcel Novák & Ján Lisý, 2020. "Vzťah medzi prílevom priamych zahraničných investícií a nezamestnanosťou v Slovenskej republike [Relationship Between Foreign Direct Investment Inflow and Unemployment in the Slovak Republic]," Politická ekonomie, Prague University of Economics and Business, vol. 2020(4), pages 443-461.
    2. Geršl, Adam & Jakubík, Petr & Kowalczyk, Dorota & Ongena, Steven & Peydró, José-Luis, 2015. "Monetary conditions and banks’ behaviour in the Czech Republic," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 407-445.
    3. Karel Janda, 2009. "Bankruptcies With Soft Budget Constraint," Manchester School, University of Manchester, vol. 77(4), pages 430-460, July.
    4. Karel Janda, 2011. "Credit Guarantees and Subsidies when Lender has a Market Power," Working Papers IES 2011/18, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Jun 2011.
    5. Michael Moritz & Bastian Stockinger & Merlind Trepesch, 2017. "Multinational Resilience or Dispensable Jobs? German FDI and Employment in the Czech Republic Around the Great Recession," Prague Economic Papers, Prague University of Economics and Business, vol. 2017(3), pages 345-359.
    6. Karel Janda, 2008. "Which Government Interventions Are Good in Alleviating Credit Market Failures?," Working Papers IES 2008/12, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Jul 2008.
    7. Vasileios A. Vlachos & Dimitris Kalimeris, 2010. "International business spillovers in emerging markets: the Visegrad group," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 3(4), pages 330-345.
    8. Hamid Baghestani & Liliana Danila, 2014. "Interest Rate and Exchange Rate Forecasting in the Czech Republic: Do Analysts Know Better than a Random Walk?," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 64(4), pages 282-295, September.
    9. Jana Marková & Markéta Arltová, 2023. "Dopad odlivu důchodů z PZI na českou ekonomiku [Impact of FDI Income Outflows for Czech Economy]," Politická ekonomie, Prague University of Economics and Business, vol. 2023(6), pages 642-667.

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    More about this item

    Keywords

    corporate finance; foreign direct investment; life cycle of investment;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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