Export Processing Zones and the Composition of Greenfield FDI

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Title: Export Processing Zones and the Composition of Greenfield FDI
Authors: Davies, Ronald B.
Desbordes, Rodolphe
Permanent link: http://hdl.handle.net/10197/9448
Date: Apr-2018
Abstract: Export processing zones (EPZs) are an increasingly common type of special economic zone. They are designed to facilitate international trade by lowering trade costs, such as import duties and/or export taxes. EPZs should thus be particularly attractive locations for multinational enterprises engaging in vertical, trade-intensive, foreign direct investment (FDI). Using data on worldwide greenfield FDI projects over the period 2003-2014, we find patterns consistent with this hypothesis. EPZs have a large positive effect on manufacturing FDI projects with a production focus, especially in trade- and labour-intensive sectors. Overall, our results suggest that EPZs are an effective tool to attract manufacturing FDI which exploit the opportunities offered by global value chains.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Start page: 1
End page: 31
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP2018/07
Keywords: Export Processing ZoneSpecial Economic ZoneGreenfield FDIGlobal Value Chain
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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