2010/07/28 by R. Balsvik, Ragnhild Balsvik, S. A. Haller +1
Business, Management and Accounting · Economics, Econometrics and Finance · #International Business and FDI #Global trade and economics #Firm Innovation and Growth
paper · doi:10.1093/oep/gpq014
Foreign direct investment is often considered an important source\nof knowledge spillovers. However, results from the empirical literature\nrelating overall foreign presence to host country productivity are\nambiguous. We argue that this may be because different modes of\nentry may have different effects on productivity. Using 24 years of\ncomprehensive panel data for Norwegian Manufacturing, we find that\ngreenfield entry has a negative impact on the productivity growth of\ndomestic plants, while entry via acquisition affects local productivity\npositively. The net effect is a small positive effect of an overall change in foreign presence on local productivity growth.