Estimating the Impact of Time-Invariant Variables on FDI with Fixed Effects

Show simple item record Davies, Ronald B. Ionascu, Delia Kristjánsdóttir, Helga 2007-10-24T19:33:59Z 2007-10-24T19:33:59Z 2007-05
dc.description 37 p. en
dc.description.abstract This paper applies the panel fixed effects with vector decomposition estimator to three FDI datasets to estimate the impact of time-invariant variables on FDI while including fixed effects. We find that the omission of fixed effects significantly biases several of these variables, especially those proxying for trade costs and culture. After including fixed effects, we find that many time-invariant variables indicate the importance of vertical FDI. We also find that by eliminating these biases, the differences across datasets largely disappear. Thus, controversies in the literature that are driven by differences in data sets may be resolved by using this estimation technique. en
dc.format.extent 178846 bytes
dc.format.mimetype application/pdf
dc.language.iso en_US en
dc.publisher University of Oregon, Dept of Economics en
dc.relation.ispartofseries University of Oregon Economics Department Working Papers ; 2007-8 en
dc.subject Foreign direct investment en
dc.subject Trade costs en
dc.subject Culture en
dc.title Estimating the Impact of Time-Invariant Variables on FDI with Fixed Effects en
dc.type Working Paper en

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