Real exchange-rate uncertainty and US foreign direct investment: an empirical analysis/ created by Christian W. Schmidt and Udo Broll
Material type: TextSeries: Review of world economics ; Volume 145, number 3Heidelberg: Springer, 2009Content type:- text
- unmediated
- volume
- 16102878
- HF135 REV
Item type | Current library | Call number | Vol info | Copy number | Status | Notes | Date due | Barcode | |
---|---|---|---|---|---|---|---|---|---|
Journal Article | Main Library - Special Collections | HF135 REV (Browse shelf(Opens below)) | Vol. 145, no.3 (pages 513-530) | SP3244 | Not for loan | For in house use only |
This paper empirically analyzes the impact of exchange-rate uncertainty, exchange-rate movements, and expectations on foreign direct investment (FDI). Using data on US outward FDI for the period 1984–2004 we examine two competing measures of exchange-rate volatility. While the standard measure yields a discouraging effect on FDI outflows in all industries the alternative risk specification reveals a clear distinction between manufacturing and non-manufacturing industries, with the latter showing a positive correlation with increased exchange risk. A real appreciation of host-country currency was associated with higher FDI flows, while expectations about an appreciation showed a negative result.
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