Trade & FDI in Petroleum Exporting Countries: Complements or Substitutes?
46 Pages Posted: 9 Dec 2005
Date Written: 2005
The paper presents econometric analysis of relationship between foreign direct investment and international trade. Theory suggests that complementarity or substitutability between exports/imports and FDI depend on types of FDI and disaggregation level. Nevertheless, most empirical works find very seldom substitutability effects. The results of panel data estimation show substitutability between FDI and trade in petroleum exporters of ex-USSR and complementarity in the rest of the countries of the same region. Also found that such effects are repeated in five biggest petroleum exporters and other transition economies of Central and Eastern Europe.
Keywords: Foreign Direct Investment, International Trade, Oil & Gas, Transition Economies
JEL Classification: F21, Q39
Suggested Citation: Suggested Citation