Impact of regional trade agreements of FDI flows

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Tezin Türü: Yüksek Lisans

Tezin Yürütüldüğü Kurum: İstanbul Ticaret Üniversitesi, Dış Ticaret Enstitüsü, Uluslararası Ticaret Ana Bilim Dalı, Türkiye

Tezin Onay Tarihi: 2017

Tezin Dili: İngilizce

Öğrenci: Muhammad Moiz

Danışman: AHMET OĞUZ DEMİR

Özet:

Recent proliferation of regional trade agreements has led to both a higher amount of trade and foreign direct investment flows. A number of studies have analyzed the impact of RTAs on the FDI and show that RTAs do lead to higher FDI flows for member countries. However, most of these studies have been conducted on North countries given that the data is readily available for them. A small number of studies have also focused on South countries yet there is a need for more studies. As a part of this study, three RTAs (ASEAN, MERCOSUR, and SACU) have been selected to analyze their impact on FDI flows to emerging economies of Brazil, China, India, and South Africa. The dataset includes 4 host countries and 71 source countries for a 12 year period from 2001 to 2012, totaling 852 observations. The gravity model is used to analyze the data for this study. The results show that ASEAN has a FDI diversion effect for our host countries whereas MERCOSUR and SACU lead to 0.24% and 0.22% higher FDI respectively given that only the host country is a member of the RTA. GDP of home and host countries are seen to have a significant positive impact on the FDI flows. It is concluded that South-South RTAs do not necessarily increase the attractiveness of host countries for FDI.