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THE DETERMINANTS OF KOREA’S FOREIGN DIRECT INVESTMENT FROM THE UNITED STATES, 1980–2001: AN EMPIRICAL INVESTIGATION OF FIRM‐LEVEL DATA
Author(s) -
JEON BANG NAM,
RHEE SUNG SUP
Publication year - 2008
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.2007.00061.x
Subject(s) - foreign direct investment , economics , exchange rate , international economics , wage , monetary economics , investment (military) , interest rate , demographic economics , macroeconomics , labour economics , politics , political science , law
This paper examines the link between Korea’s foreign direct investment (FDI) inflows from the United States and locational, financial, and macroeconomic variables using firm‐level data of FDI transactions, which were completed during the period from January 1980 to February 2001. Korea’s FDI inflows from the United States are found to have significant associations with real exchange rates, relative wealth, relative wage costs, expected exchange rate changes, and interest rate differentials. The extent and direction of the links, however, have varied according to different FDI regimes during the last 20 yr in Korea. Industry‐specific factors have also played a role in determining Korea’s FDI inflows . ( JEL F21, F30)