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FDI and Trade Outcomes at the Industry Level—A Data-Driven Approach (English)

This paper proposes a novel empirical methodology to reveal factors associated with foreign direct investment decisions and export success at the industry level. Faced with large amounts of policy and economic indicators, as well as significant product and sectoral diversity, the motivation of this research is twofold. First, it selects among the vast number of indicators and potential factors relevant to investment and trade outcomes a manageable subset of variables that can usefully guide the understanding of investment and trade outcomes. Second, it provides robust estimates of how these variables affect the probability at the margin of investment and trade outcomes at the sector level. Finally, the paper uses these estimates to produce new metrics (“scores”) of trade and investment climate performance at the country and sectoral levels.

Details

  • Author

    Maur,Jean-Christophe, Nedeljkovic,Milan, Von Uexkull,Jan Erik

  • Document Date

    2022/01/13

  • Document Type

    Policy Research Working Paper

  • Report Number

    WPS9901

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    World,

  • Region

    The World Region,

  • Disclosure Date

    2022/01/13

  • Disclosure Status

    Disclosed

  • Doc Name

    FDI and Trade Outcomes at the Industry Level—A Data-Driven Approach

  • Keywords

    trade and investment; general government final consumption expenditure; International Trade and Investment; social rate of return; investment climate assessment; foreign direct investment; parameter of interest; access to finance; determinants of trade; natural resource rent; panel data model; balance of payment; international trade flows; public policy reform; trade policy variables; trade and competitiveness; natural resource endowment; sector specific information; identification of constraints; measure of trade; forecast performance; customs clearance time; impact of policy; per capita income; return to investment; financial market development; labor market efficiency; private sector initiative; private sector activity; investment climate constraint; labor market regulation; Value for Money; business environment indicator; country fixed effect; Rule of Law; natural resource production; indicators of demand; incentives for investment; tertiary education enrollment; urban population growth; crime and violence; bilateral trade flow; behavior of firms; gravity model; machine learning; comparative advantage; potential indicators; individual policy; binding constraint; export success; empirical analysis; trade datum; political stability; enterprise survey; firm level; econometric approach; best practice; population size; recipient countries; coefficient estimate; gravity approach; transport cost; relative performance; pay taxes; empirical model; product specific; macroeconomic environment; financial service; individual indicator; business cost; linear model; empirical work; confidence interval; correct classification; statistical inference; policy outcome; Economic Policy; expert judgment; export competitiveness; empirical literature

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Citation

Maur,Jean-Christophe Nedeljkovic,Milan Von Uexkull,Jan Erik

FDI and Trade Outcomes at the Industry Level—A Data-Driven Approach (English). Policy Research working paper,no. WPS 9901 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/310711642106825113/FDI-and-Trade-Outcomes-at-the-Industry-Level-A-Data-Driven-Approach