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U.S. Foreign Direct Investment And Trade: Substitutes Or Complements? The Case Of The Food Processing Industry

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  • Somwaru, Agapi
  • Bolling, H. Christine

Abstract

The role of foreign direct investment as a complement or substitute to foreign trade continues to be debated in regard to the food processing industry. This study extends earlier work to demonstrate that FDI and trade depend on the stage and the similarities of the economic development of the host countries, as macroeconomic factors--such as exchange rate fluctuations and income growth-- act differently in developing vs. developed countries, and exporting vs. importing countries.

Suggested Citation

  • Somwaru, Agapi & Bolling, H. Christine, 1999. "U.S. Foreign Direct Investment And Trade: Substitutes Or Complements? The Case Of The Food Processing Industry," 1999 Annual meeting, August 8-11, Nashville, TN 21715, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea99:21715
    DOI: 10.22004/ag.econ.21715
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    References listed on IDEAS

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    1. Munisamy Gopinath & Daniel Pick & Utpal Vasavada, 1999. "The Economics of Foreign Direct Investment and Trade with an Application to the U.S. Food Processing Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(2), pages 442-452.
    2. Alan V. Deardorff, 2011. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 24, pages 267-293, World Scientific Publishing Co. Pte. Ltd..
    3. Barrell, Ray & Pain, Nigel, 1996. "An Econometric Analysis of U.S. Foreign Direct Investment," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 200-207, May.
    4. James R. Markusen, 2021. "Explaining the Volume of Trade: An Eclectic Approach," World Scientific Book Chapters, in: BROADENING TRADE THEORY Incorporating Market Realities into Traditional Models, chapter 9, pages 177-186, World Scientific Publishing Co. Pte. Ltd..
    5. Bolling, H. Christine & Neff, Steven & Handy, Charles R., 1998. "U.S. Foreign Direct Investment in the Western Hemisphere Processed Food Industry," Agricultural Economic Reports 34017, United States Department of Agriculture, Economic Research Service.
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    Cited by:

    1. Mattson, Jeremy W. & Koo, Won W., 2002. "U.S. Processed Food Exports And Foreign Direct Investment In The Western Hemisphere," Agribusiness & Applied Economics Report 23547, North Dakota State University, Department of Agribusiness and Applied Economics.
    2. Zhuang, Renan & Koo, Won W. & Mattson, Jeremy W., 2008. "Growing U.S. Trade Deficit in Consumer-Oriented Agricultural Products," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 40(3), pages 1-13, December.

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