Gifted kids or pushy parents? Foreign direct investment and plant productivity in Indonesia

• 成果类型: Article
• 署名作者: Arnold, Jens Matthias; Javorcik, Beata S.
• 署名单位: Organisation for Economic Co-operation & Development (OECD); University of Oxford; Centre for Economic Policy Research - UK; University of Oxford
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2009.05.004
• 发表日期: 2009
• 页码: 42-53
• 关键词: foreign direct investment; PRODUCTIVITY; acquisitions; Privatizations; Emerging markets

摘要

This paper analyzes the causal relationship between foreign ownership and various aspects of plant performance using micro data from the Indonesian Census of Manufacturing. It examines the implications of foreign ownership in two different contexts: foreign acquisitions and foreign privatizations. To control for the possible endogeneity of FDI decision propensity score matching is combined with a difference-in-differences approach. The results indicate that foreign ownership leads to significant productivity improvements in the acquired plants. The improvements become visible in the acquisition year and continue in subsequent periods. After three years, the acquired plants exhibit a 13.5% higher productivity than the control group. The rise in productivity is a result of restructuring, as acquired plants increase investment outlays, employment and wages. Foreign ownership also appears to enhance the integration of plants into the global economy through increased exports and imports. Finally, productivity improvements and evidence of restructuring are also found in the context of foreign privatizations. (C) 2009 Elsevier B.V. All rights reserved.