Does foreign direct investment stimulate new firm creation? In search of spillovers through industrial and geographical linkages

Sun, L., Lee, I.H., & Hong, E. (2016). Does foreign direct investment stimulate new firm creation? In search of spillovers through industrial and geographical linkages. Small Business Economics 1-19. 10.1007/s11187-016-9803-0.

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Abstract

This paper examines the spillover effects of inward foreign direct investment (FDI) on the entrepreneurial activities of new firm creation through both industrial and geographical linkages. Using a dataset of 44,434 newly created small firms in 234 regions of South Korea in 2000–2004, this study finds that while the spillover impacts of FDI in the low-tech industry are positive and significant across almost all four possible combinations of the intra-/inter-regional and intra-/inter-sectoral channels, the impacts in the high-tech industry are largely intra-sectoral within the host region and across neighboring regions. Moreover, all statistically significant spillover effects follow an inverted ‘U’-shaped curvilinear trend.

Item Type:	Article
Uncontrolled Keywords:	Inward foreign direct investment; new firm creation; entrepreneurship; sectoral and spatial analysis
Research Programs:	Water (WAT)
Depositing User:	Romeo Molina
Date Deposited:	27 Sep 2016 13:29
Last Modified:	27 Aug 2021 17:27
URI:	https://pure.iiasa.ac.at/13840

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