Backward and Forward Linkages of Productivity Effect from Foreign Direct Investment

DOI

10.2991/aicmar-18.2019.5How to use a DOI?

Keywords

backward and forward linkages; productivity; foreign direct investment; manufacturing; upsteam; downstream firms

Abstract

Productivity related to foreign direct investment (FDI) has been examined for the last two decades, but the findings are mixed. This paper contributes to shed the light by analyzing the backward and forward linkages of FDI-related productivity. By estimating manufacturing firms of Indonesia, the results shows that there is a positive backward linkage from FDI in local firms on domestic firms in upstream 3-digit industries. There is also a positive forward linkage from FDI in local firms in downstream industries. The findings implicate the demonstration effect and skill-training effect of foreign firms to local firms in the industrial line. The findings are robust under fixed effect model, general method of moment model, and instrumental variable model.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Suyanto
AU  - Yenny Sugiarti
PY  - 2019/02
DA  - 2019/02
TI  - Backward and Forward Linkages of Productivity Effect from Foreign Direct Investment
BT  - Proceedings of the 5th Annual International Conference on Management Research (AICMaR 2018)
PB  - Atlantis Press
SP  - 20
EP  - 23
SN  - 2352-5428
UR  - https://doi.org/10.2991/aicmar-18.2019.5
DO  - 10.2991/aicmar-18.2019.5
ID  - 2019/02
ER  -