Dissertations, Theses, and Capstone Projects

Date of Degree

2011

Document Type

Dissertation

Degree Name

Ph.D.

Program

Economics

Advisor

Robert Lipsey

Committee Members

Wim Vijverberg

Zadia Feliciano

Subject Categories

Economics

Abstract

Essay 1: Most of studies on developing countries have found evidence that international linkages, such as foreign ownership, exporting, or importing, affect productivity growth, but since these variables are correlated, it is hard to distinguish among their effects. This paper tackles this issue by explicitly investigating and comparing the productivity effects of all three international linkages at plant levels in case of Indonesian manufacturing plants during 1993-2001. Overall, the paper finds that foreign ownership, first, and importing, second, but exporting doubtfully, promoted productivity growth. Productivity jumps in the year when plants are acquired by foreigners or when plants first start to import, although the productivity effects from importing become smaller after two years following the initiation of imports. Methodologically, I first obtain a measure of plant productivity that corrects for the selection and simultaneity biases. Then I control for plant characteristics through matched sampling techniques to establish proper comparison sets between plants with and without international linkages. Thirdly I apply difference-in-differences model and plant-pair fixed-effects regressions on matched samples. The unobserved plant characteristics are effectively controlled this way.

Essay 2: Studies have shown that foreign direct investment (FDI) is the main driver for China's rapid export growth in recent decades. This paper asks how China's export growth is associated with the exports from its investing countries. I first examine and compare the evolution of the export growth of China and its investing countries over time (1962-2006), and then assess the similarity between their present export bundles by trading partners and sectors. The results show that China's export content is increasingly similar to that of its investing countries, despite China's relatively low income levels. Lastly, I identify the impact of China's export growth on its investing countries' exports using gravity equation. The results show a complementary relationship between China's exports and its investing countries' exports.

Essay 3: Borrowed from the literature of program evaluation, the combination of difference-in-differences and propensity score matching is becoming popular in the literature of foreign direct investment (FDI). This study evaluates the extent to which the matching estimator is sensitive to the choice of matching methods in the study of foreign acquisition and compares the matching estimator with various panel data techniques widely used in the related literature that resolve the endogeneity issue. Using the panel data on Indonesian manufacturing establishments for 1975-2005, I find that the different matching methods produce similar estimates when the balancing property is satisfied. Furthermore, the estimates from the matching estimator are most similar to the fixed effects estimates and dynamic panel estimates.

Comments

Digital reproduction from the UMI microform.

Download

Included in

Economics Commons

Share

COinS