Download The Impacts of Regional Economic Integration on the Determinants

The Impacts of Regional Economic Integration on the Determinants
of Member Nations’ Foreign Direct Investments: The Case of
European Union
1. 논문 (연구) 요약
The impacts of regional economic integration (REI) on member nation ’ s foreign direct
investment (FDI) activities have been relatively neglected compared to the activities of
nonmember nations in the integrated regions. As a result, the main purpose of this study is to
analyze how the determinants of EU member nation ’s inward and outward foreign direct
investment have been changed over the progressing process of the EU. This study finds that
ownership and/or internalization specific advantages are more important than location specific
advantages are in attracting inward foreign direct investment (IFDI) into EU15, and in making
outward foreign direct investment (OFDI) by EU15 according to the process of the EU
2. 논문(연구)주제를 선정한 이유
The global business environment in the past decades can be strikingly characterized as the
simultaneous movements of globalization and regionalization which may have opposite
concepts. Globalization is defined as the process which establishes economic linkages and
interdependencies based on international trade in goods and services foreign direct investment
(FDI) and other economic activities with other economic entities throughout the world.
Regionalization is the process which establishes a geographical region based on the
discriminatory removals of trade and investment impediments and/or voluntary coordination of
economic and other policies among member nations.
Globalization which has integrated national economies and has influenced multinational
enterprises (MNEs) business activities could be an equally given factor to all economic entities
relatively. However regionalization is an unequal business environment to members and nonmembers economic entities. In other words although both globalization and regionalization have
promoted the structural transformation of firms and nations the impacts of regional economic
integration (REI) on members and non-members nations and their MNEs could be more
complicated and/or severe than those of globalization.
Most studies on the impacts of regional economic integration on MNEs international production
activities in the early years have been limited to the two streams. First, the European Union and
North American Free Trade Area have been major regions to be studied. Second, MNEs have
been the most frequently used samples in the study of the relationship between REI and MNE
activities. Not only the lack of availability and the short time-span of data, but also the
discriminatory effects of REI have limited researchers’ contributions to only a few advanced
non-member countries and regions.
Because of these kinds of research streams, the impacts of REI on member nations FDI
activities especially outward FDI have been relatively neglected even though member nations
have had an important role in the world economy .For example even though EU has occupied
51.3% in the world outward FDI stocks by the end of 2005.
3, 연구(논문)의 목적
The studies of EU nations in the world market have been comparatively underestimated by
those of non-member nations into the EU. As a result the major purpose of this study is to
analyze how the determinants of EU member nation’s inward and outward foreign direct
investment have been changed over the deepening process of the EU.
4. 논문(연구)의 선행연구 정리
The theory of economic integration was originally developed from the traditional trade theory
and the major theoretical concern of international trade theory is the location of production
rather than the ownership of production under the assumption of perfect competition. In other
words the trade theory has little interest to or can not explain the dynamic issue of the relative
comparison of foreign owned productions and their domestic counterparts.
While the international production theory draws upon the theory of trade and location, it is also
concerned with identifying the consequences of foreign ownership of economic activities within
an integrated region in terms of the structure and location of those activities. However, it is
difficult to say that the international production theory is a better approach for explaining the
economic integration effects than international trade theory simply because the international
trade theory only deals with location matters. Rather the two analytical approaches are
competing and complementary to each other for explaining the impacts of regional economic
integration (Dunning 1997)
5.
논문(연구)의
선행연구에서
당신이
중요하다고
생각하는
2
개
논문(연구)를
간략하게
정리하세요.
The theory of economic integration was originally developed from the traditional trade theory
and the major theoretical concern of international trade theory is the location of production
rather than the ownership of production under the assumption of perfect competition. In other
words the trade theory has little interest to or can not explain the dynamic issue of the relative
comparison of foreign owned productions and their domestic counterparts.
While the international production theory draws upon the theory of trade and location, it is also
concerned with identifying the consequences of foreign ownership of economic activities within
an integrated region in terms of the structure and location of those activities. However, it is
difficult to say that the international production theory is a better approach for explaining the
economic integration effects than international trade theory simply because the international
trade theory only deals with location matters. Rather the two analytical approaches are
competing and complementary to each other for explaining the impacts of regional economic
integration (Dunning 1997)
6. 논문(연구)의 연구모형을 제시하고 연구변수와 가설설정을 설명해주세요
1）Dependent Variables
Dependent variables used in this study are EU 15 FDI stocks (Inward and Outward FDI) at a
country level. There are several reasons to use stocks rather than flows.
First, compared to stocks calculated by accumulated flows from previous year flow data tend to
be more volatile and unstable than that of stocks.
Second because FDI is a long term investment the accumulated amounts of stocks in foreign
production facilities can be more meaningful than the flows of a certain year.
2）Independent Variables
The theoretical research model being used in this study is the Dunning’s Eclectic Paradigm
explanatory variables are classified into three groups: Ownership, Location and Internalization
specific advantages.
7. 논문의 연구변수가 어떠한 선행연구로부터 근거하고 있나요 설명하거나 서술해주세요
1) Interest Rate – (Ajami & BarNiv, 1984; Tallman 1988; Grosse & Trevino 1996; Clegg. 1995;
Kyrkills & Pantelidis 2003; Zhao 2003) It was measured by the member nation’s country’s longterm interest rate.
2) Exchange Rate—measure by member nation’s real effective exchange rate( Froot & Stein
1991 : Pan 2002 : Clegg 1995: Caves 1996: Lee 2003: Kykilis & Pantelidis 2003)
3) Tax—affecting FDI decision-making(Mody and Srinivasan 1998 et al) It was measure by ratio
fo total tax revenue to GDP
4)
Technology—R&D
expenditure
being
used
as
prowy
for
innovation
in
previous
studies.(Clegg1978et al)
5) Development—(Narula & Wakelin 1997) It was measured by member nation’s share of gross
fied capital formation in member nations’ GDP
6) Competitiveness—Competitiveness which is proved to be one of the important determinant
factors in study by Rajneesh Narula and Katharine Wakelin(1998)
8. 가설검증에 관한 결과를 제시하고 설명해주세요. 그리고 결과가 어떤 의미를 나타내고 있나요
The proposition 1 which expects that the importance of regional economic integration factor on
the determinants of IFDI into EU15 is diminished according to the process of REI is supported
in this study.
The proposition 2 which expects that Ownership and/or Internalization specific advantages are
becoming more important factors to determine inward foreign direct investment (IFDI) into EU15
than location specific advantages are according to the process of REI is supported in this study.
The proposition 3 which expects that the importance of regional economic integration factor on
the determinants of OFDI into EU15 is increased according to the process of REI is supported
in this study.
The proposition 4 which expects that ownership and/or Internalization specific advantages are
becoming more important factors to determine outward foreign direct investment (OFDI) by
EU15 than location specific advantages are according to the process of REI is supported.
9. 통계분석결과가 주는 시사점(IMPLICATION)은 어떤 것인가요
The findings of this provide some implications. The result of the relationship between regional
economic integration (REI) and FDI shows that REI itself can not automatically lead to IFDI and
/ or OFDI because the static effects of REI are confined to market expansion and only attract
tariff-jumping types of IFDI. According to the process of REI the dynamic effects of REI are
becoming more important for attracting IFDI and for making OFDI.
10. 결론은 무엇인가요
One of the most important findings of the study is that ownership and/or internalization s
pecific advantages (dynamic effects) are more important than location specific advantages
(static effects) in attracting inward foreign direct investment (IFDI) into EU15 and in making
outward foreign direct investment (OFDI) by EU15 Among all the variables of OLI factors.
The findings of this study provide some implications. The result of the relationship betwe
en regional economic integration (REI) and FDI shows that REI itself can not automatically
lead to IFDI and/or OFDI because the static effects of REI are confined to market expansi
on and only attract tariff-jumping types of IFDI. According to the process of REI the dyna
mic effects of REI are becoming more important for attracting IFDI and for making OFDI.
Therefore increasing competitiveness should be a major strategic goal for nations and M
NEs. Becoming a member of REI can not guarantee competitiveness IFDI and OFDI. At the
initial stage of REI simple location specific advantages by the static effects can attract IF
DI and pre-owned ownership specific advantages can make OFDI. However all of OLI fact
ors are important for attracting and for making FDI according to the process of REI. Theref
ore the role of the government in this process is to upgrade the configurations of OLI.