Skip to main content
SpringerLink
Log in

Institutional Determinants of Outward Foreign Direct Investment from Emerging Economies: A Home-Country Perspective

  • Chapter
Institutional Impacts on Firm Internationalization

Abstract

The growing international insertion of multinational companies originating from emerging economies (EMNCs) can be described as a major trend in the current world economic scenario. During the last two decades, outward foreign direct investment from such economies grew at a higher year average rate than those from developed economies. Their participation in the world outward FDI grew from 11 per cent in 2000 to 28 per cent in 2010, and their outward stock reached more than 15 per cent of the world FDI outward stock, compared with a performance of less than 10 per cent in the 1990s (UNCTAD, 2013).

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 39.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 54.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 54.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  • Amal, M., Raboch, H. and Tomio, B.T. (2009). Strategies and Determinants of Foreign Direct Investment (FDI) from Emerging Countries: Case Study of Latin America, Latin American Business Review, 10(2–3): 73–94.

    Article  Google Scholar 

  • Arbix, G. (2010). Structural Change and the Emergence of the Brazilian MNEs, International Journal of Emerging Markets, 5(3/4): 266–88.

    Article  Google Scholar 

  • Bae, S. and Hwang, S. (1997). An Empirical Analysis of Outward Foreign Direct Investment of Korea and Japan, Multinational Business Review, 5(2): 71–80.

    Google Scholar 

  • Baltagi, B. and Raj, B. (1992). Empirical Economics. Heidelberg: Physica-Verlag.

    Google Scholar 

  • BCG (2009). The 2008 BCG 100 New Global Challengers: How Top Companies from Rapidly Emerging Economies Are Changing the World. Boston: Boston Consultancy Group.

    Google Scholar 

  • Bevan, A., Estrin, S. and Meyer, K. (2004). Foreign Investment Location and Institutional Development in Transition Economies, International Business Review, 13(1): 43–64.

    Article  Google Scholar 

  • Bhasin, N. and Jain, V. (2013). Home Country Determinants of Outward FDI: A Study of Selected Asian Economies. Working Paper. Available at: http://ssrn.com/abstract=2206738.

    Google Scholar 

  • Blomström, M. and Kokko, A. (1996). Multinational Corporations and Spillovers, Journal of Economic Surveys, 12(3): 247–77.

    Article  Google Scholar 

  • Buckley, P. and Casson, M. (1976). The Future of the Multinational Enterprise. London: Homes and Meier.

    Google Scholar 

  • Buckley, P., Clegg, J., Cross, A., Liu, X, Voss, H. and Zheng, P. (2007). The Determinants of Chinese Outward Foreign Direct Investment, Journal of International Business Studies, 38(4): 499–518.

    Article  Google Scholar 

  • Buckley, P., Cross, A., Tan, H., Voss, H. and Liu, X. (2006). An Investigation of Recent Trends in Chinese Outward Direct Investment and Some Implications for Theory, Centre for International Business University of Leeds Working Paper.

    Google Scholar 

  • Chen, K., Rau, H. and Lin, C. 2006. The Impact of Exchange Rate Movements on Foreign Direct Investment: Market-Oriented Versus Cost-Oriented, The Emerging Economies, 44(3): 269–87.

    Google Scholar 

  • Cheng, L.K. and Ma, Z. (2007). China’s Outward FDI: Past and Future, SERUC Working Paper, no. 200706001E.

    Google Scholar 

  • Chittoor, R., Ray, S., Aulakh, P. and Sarkar, M. (2008). Strategic Responses to Institutional Changes: ‘Indigenous Growth’ Model of the Indian Pharmaceutical Industry, Journal of International Management, 14(3): 252–69.

    Article  Google Scholar 

  • Cuervo-Cazurra, A. (2007). Sequence of Value-Added Activities in the Multinationalization of Emerging Country Firms, Journal of International Management, 13(3): 258–77.

    Article  Google Scholar 

  • Daude, C. and Stein, E. (2007). The Quality of Institutions and Foreign Direct Investment, Economics & Politics, 19(3): 317–44.

    Article  Google Scholar 

  • Dunning, J.H. (1988). The Eclectic Paradigm of International Production: A Restatement and Possible Extensions, Journal of International Business Studies, 19: 1–31.

    Article  Google Scholar 

  • Dunning, J.H. and Lundan, S.M. (2008). Multinational Enterprises and the Global Economy. Cheltenham, UK: Edward Elgar.

    Google Scholar 

  • Dunning, J.H. and Narula, R. (1996). The Investment Development Path Revisited. Some Emerging Issues. In Dunning, J.H. and Narula R. (Eds.) Foreign Direct Investment and Governments: Catalysts for Economic Restructuring. London: Routledge: 1–40.

    Google Scholar 

  • Enderwick, P. (2009). Large Emerging Markets (LEMs) and International Strategy, International Marketing Review, 26(1): 7–16.

    Article  Google Scholar 

  • Faria, A. and Mauro, P. (2009). Institutions and the External Capital Structure of Countries, Journal of International Money and Finance, 28(3): 367–91.

    Article  Google Scholar 

  • Frenkel, M., Funke, K. and Stadtmann, G. (2004). A Panel Analysis of Bilateral FDI Flows to Emerging Economies, Economic Systems, 28(3): 281–300.

    Article  Google Scholar 

  • Fung, K.C., Garcia-Herrera, A. and Siu, A. (2009). A Comparative Empirical Examination of Outward Foreign Direct Investment from Four Asian Economies: Peoples Republic of China; Japan; Republic of Korea and Taipei, China, Asian Development Review, 26(2): 86–101.

    Google Scholar 

  • Gammeltoft, P., Pradhan, J. and Goldstein, A. (2010). Emerging Multinationals: Home and Host Country Determinants and Outcomes, International Journal of Emerging Markets, 5(3/4): 254–65.

    Article  Google Scholar 

  • Globerman, S. and Shapiro, D. (2002). Global Foreign Direct Investment Flows: The Role of Governance Infrastructure, World Development, 30(11): 1898–1919.

    Article  Google Scholar 

  • Goldstein, A. and Pusterla, F. (2010). Emerging Economies’ Multinationals: General Features and Specificities of the Brazilian and Chinese Cases, International Journal of Emerging Markets, 5(3/4): 289–306.

    Article  Google Scholar 

  • He, X. and Cui, L. (2012). Can Strong Home Country Institutions Foster the Internationalization of MNEs? Multinational Business Review, 20(4): 352–75.

    Article  Google Scholar 

  • Hymer, S. (1976). The International Operation of a National Firm: A Study of Direct Foreign Investments. Cambridge, MA: The MIT Press.

    Google Scholar 

  • Kalotay, K. and Sulstarova, A. (2010). Modeling Russian Outward FDI, Journal of International Management, 16(2): 131–42.

    Article  Google Scholar 

  • Kapuria-Foreman, V. (2008). Economic Freedom and Foreign Direct Investment in Emerging Countries, The Journal of Emerging Areas, 41(1): 143–55.

    Article  Google Scholar 

  • Kaufmann, D., Kraay, A. and Zoido-Lobatón, P. (1999). Governance Matters’, World Bank Policy. Research Working Paper No. 2196.

    Google Scholar 

  • Kaufman, D., Kraay, A. and Mastrazzi, M. (2009). Governance Matters VIII: Aggregate and Individual Governance Indicators for 1996–2008, Working Paper, World Bank Policy Research Working Paper 4978.

    Book  Google Scholar 

  • Kolstad, I. and Wiig, A. (2009). What Determines Chinese Outward FDI? CMI Working Paper, WP 2009: 3.

    Google Scholar 

  • Kostova, T. (1999). Transnational Transfer of Strategic Organizational Practices: A Contextual Perspective, Academy of Management Review, 24(1): 308–24.

    Google Scholar 

  • Kostova, T. and Zaheer, S. (1999). Organizational Legitimacy Under Conditions of Complexity: The Case of the Multinational Enterprise, Academy of Management Review, 24(1): 64–81.

    Google Scholar 

  • Kyrkilis, D. and Pantelidis, P. (2003). Macroeconomic Determinants of Foreign Direct Investment, International Journal of Social Economics, 30(7): 827–36.

    Article  Google Scholar 

  • Kyrkilis, D. and Pantelidis, P. (2005). A Cross Country Analysis of Outward Foreign Direct Investment Patterns, International Journal of Social Economics, 32(6): 510–19.

    Article  Google Scholar 

  • Luo, Y., Xue, Q. and Han, B. (2010). How Emerging Market Governments Promote Outward FDI: Experience from China, Journal of World Business Studies, 45(1): 68–79.

    Article  Google Scholar 

  • McMillan, J. (2007). Market Institutions. In Blume, S. and Durlauf, L. (Eds.) The New Palgrave Dictionary of Economics. 2nd Edition, London: Palgrave: 26–38.

    Google Scholar 

  • Mudambi, R. and Navarra, P. (2002). Institutions and International Business: A Theoretical Overview, International Business Review, 11(1): 35–55.

    Article  Google Scholar 

  • Narula, R. (2011). Do We Need Different Frameworks to Explain Infant MNEs from Emerging Countries? John Dunning Center for International Business, Discussion Paper, Nr.2011–005 December.

    Google Scholar 

  • North, D. (1990). Institutions, Institutional Change and Economic Performance. Cambridge, MA: Cambridge University Press.

    Book  Google Scholar 

  • Pangarkar, N. and Lim, H. (2003). Performance of Foreign Direct Investment from Singapore, International Business Review, 12(5): 601–24.

    Article  Google Scholar 

  • Peng, M.W. (2009). Global Strategy. 2nd Edition, Cincinnati, OH: South-Western Cengage Learning.

    Google Scholar 

  • Peng, M., Wang, D. and Jiang, Y. (2008). An Institution-Based View of International Business Strategy: A Focus on Emerging Economies, Journal of International Business Studies, 39(5): 920–36.

    Article  Google Scholar 

  • Rasiah, R., Gammeltoft, P. and Jiang, Y. (2010). Home Government Policies for Outward FDI from Emerging Economies: Lessons from Asia, International Journal of Emerging Market, 5(3/4): 333–57.

    Article  Google Scholar 

  • Rugman, A., Oh, C.H. and Lim, D.S.K. (2011). The Regional and Global Competitiveness of Multinational Firms, John Dunning Center for International Business, Discussion Paper, Nr.2011–003 June.

    Google Scholar 

  • Scott, W.R. (2008). Institutions and Organizations. 3rd Edition, Thousand Oaks, CA: Sage.

    Google Scholar 

  • Seo, J. and Suh, C. (2006). An Analysis of Home Country Trade Effects of Outward Foreign Direct Investment: The Korean Experience with ASEAN, 1987–2002, ASEAN Economic Bulletin, 23(2): 160–70.

    Article  Google Scholar 

  • Swenson, D. (2004). Foreign Investment and the Mediation of Trade Flows, Review of International Economics, 12(4): 609–29.

    Article  Google Scholar 

  • Tolentino, P.E. (2010). Home Country Macroeconomic Factors and Outward FDI of China and India, Journal of International Management, 16(2): 102–20.

    Article  Google Scholar 

  • UNCTAD. (2008). World Investment Report2008. New York and Geneva: United Nations.

    Google Scholar 

  • UNCTAD. (2013). Statistics on Foreign Direct Investment. Available at: http://unctadstat.unctad.org/. Accessed 13 January 2013.

    Google Scholar 

  • Vernon, R. (1966). International Investments and International Trade in the Product Cycle, Quarterly Journal of Economics, 80(2): 190–207.

    Article  Google Scholar 

  • Voss, H. (2011). The Determinants of Chinese Outward Direct Investment. Cheltenham, UK: Edward Elgar Publishing.

    Book  Google Scholar 

  • Witt, M. and Lewin, A. (2007). Outward Foreign Direct Investment as Escape Response to Home Country Institutional Constraints, Journal of International Business Studies, 38(4): 579–94.

    Article  Google Scholar 

  • Xing, Y. and Wan, G. (2006). Exchange Rates and Competition for FDI in Asia, World Economy, 29(4): 419–34.

    Article  Google Scholar 

  • Xu, D. and Shenkar, O. (2002). Institutional Distance and the Multinational Enterprise, Academy of Management Review, 27(4): 608–18.

    Google Scholar 

Download references

Authors
  1. Mohamed Amal
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Bruno Thiago Tomio
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. Aalborg University, Denmark

    Svetla Marinova

Copyright information

© 2015 Mohamed Amal and Bruno Thiago Tomio

About this chapter

Cite this chapter

Amal, M., Tomio, B.T. (2015). Institutional Determinants of Outward Foreign Direct Investment from Emerging Economies: A Home-Country Perspective. In: Marinova, S. (eds) Institutional Impacts on Firm Internationalization. Palgrave Macmillan, London. https://doi.org/10.1057/9781137446350_3

Download citation

Publish with us

Policies and ethics

Search

Navigation