발표 : 许文忠(台湾 暨南大学) 
토론 : 김동하(부산외대)

ABSTRACT

This paper pursues the idea that the relationship between foreign and domestic investment may be not as uniform as many studies suggest. By examining the case of Taiwanese outward foreign direct investment (OFDI), this paper is marked out from existing studies in the following three respects. First, it examines the extent to which the relationship between OFDI and domestic investment varies with the location of investment. Second, this research allows the results to vary between Heckscher-Ohlin industries and Schumpeter industries. Finally, its breakdown of data will reveal sub-relationships in the data that up to now have remained hidden within the aggregate relationships reported in most studies. 

New evidence from analyses of Taiwanese FDI suggests that OFDI in China has a positive impact on domestic investment in Heckscher-Ohlin industries while OFDI in other countries has a negative impact on domestic investment in the same industries. These findings are in marked contrast with Schumpeter industries where a positive effect is observed only for OFDI in other countries.  Our findings also suggest that Taiwanese government should design policies to adjust the level of liberalization for overseas investment through legislation on an industry-by-industry basis in order that OFDI stimulates domestic investment in relevant industries more effectively.

Keywords: Outward FDI, home domestic investment, foreign investment location

Ⅰ. INTRODUCTION

The question of whether and to what extent OFDI affects fixed capital formation of the home country has been the subject of extensive public debate in the industrialized world (Arndt et al., 2007). Some argue that OFDI reduces home investment because the decision to invest scarce resources abroad inevitably reduces the likelihood of concurrent investments at home (e.g., Stevens and Lipsey, 1992; Chen and Ku, 2000). Others, however, maintain an opposite view, contending that foreign and home investment are complementary because of the potential interdependencies and interactions between the two types of investment through the production process (e.g., Braunerhjelm et al., 2005; Desai et al., 2005). Although highly relevant for public policy, scholars have paid only scant attention to empirical examination of this issue (Arndt et al., 2007). This is in stark contrast to the large body of empirical work on the export and employment effects of OFDI.