Nguyen, Ngoc Anh and Nguyen, Thang (2007): Foreign direct investment in Vietnam: An overview and analysis the determinants of spatial distribution across provinces.
Download (624kB) | Preview
Vietnam has been quite sucessful in attracting FDI inflows since the inception of economic reform in 1986. The inflow of FDI has contributed significantly to the economic development of Vietnam. Still, the determinants of FDI inflow and its impacts on the economy of Vietnam are under-researched. In this paper we provide an overview of foreign direct investment (FDI) in Vietnam and attempt to review of the current status of economic research on the determinants of FDI and its impacts on the economy of Vietnam. Our regression analysis of the determinants of FDI spatial distribution across provinces points to the importance of market, labour and infrastructure in attracting FDI. Government policy as measured by the Provincial Competiveness Index (PCI), however, does not seem to be a significant factor at the provincial level. Foreign investors from differenct source countries seem to behave differently in chosing the location of investment.
|Item Type:||MPRA Paper|
|Institution:||Development and Policies Research Center|
|Original Title:||Foreign direct investment in Vietnam: An overview and analysis the determinants of spatial distribution across provinces|
|Keywords:||Foreign Direct Investment; Vietnam; multinationals; spatial distribution;|
|Subjects:||F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms; International Business
F - International Economics > F2 - International Factor Movements and International Business
|Depositing User:||Anh Nguyen|
|Date Deposited:||10. Jun 2007|
|Last Modified:||13. Feb 2014 19:18|
Bagchi-Sen S. and Wheeler J.O (1989), 'A spatial and temporal model of Foreign Direct Investment in the United States', Economic Geography, 112-29
Boddy M. J. (1991), Structural approaches to industrial location, in Lever W.F., (ed.) Industrial change in the United Kingdom, Longman Scientific & Technical.
Blonigen B., (2005), A Review of the Empirical Literature on FDI Determinants, NEBR Working Paper No. 11299, National Bureau of Economic Research.
Carlton D.W (1983) 'The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables', Review of Economics and Statistics, 65, 440-49.
Casson M. (1986) 'General Theories of the Multinational Enterprise: Their Relevance to Business History', in Hertner P. and Jones G. (ed.), Multinationals: Theory and History. Hants: Gower Publishing Company Limited.
Caves R.E (1982) 'Multinational Enterprise and Economics Analysis', Cambridge Surveys of Economic Literature. Cambridge: Cambridge University Press.
Chapman, K. and Walker D. (1987), Industrial Location - Principles and Policies. Basil Blackwell.
CIEM (2004), Globalisation, Employment and Povery Reduction: Country Study of Vietnam, Report by Central Institute of Economic Management and ILO.
CIEM (2006), Vietnam’s Economy in 2005, Central Institute of Economic Management.
Collis C. and Noon D. (1994), 'Foreign Direct Investment in the UK Regions: Recent Trends and Policy Issues', Regional Studies, 28, 8, 843-48.
Coughlin C.C, Terza J.V and Arromdee V. (1991),' State characteristics and the Location of foreign direct investment within the United States', Review of Economics and Statistics, 73, 675-83.
Dollar, David (1996) “Economic Reform, Openness, and Vietnam’s Entry into ASEAN”,. ASEAN Economic Bulletin Vol. 13(2), pp. 169-183.
Dollar, David and Aart Kraay (2004) “Trade Growth, and Poverty”, The Economic Journal, 114(493), pp. F22-F49.
Dunning J.H. (1979), 'Explaining Changing Patterns of International Production: In Defence of the Eclectic Theory', Oxford Bulletin of Economics and Statistics, 41, 269-93.
Dunning J.H. (1986), Japanese Participation in British Industry. London: Croom Helm.
Dunning J.H. (1993), Multinational Enterprises and the Global Economy. Wokingham: Addison-Wesley.
Dunning J.H. (1988), Explaining International Production. London: Unwin Hyman. Freeman Nick (2002), Foreign Direct Investment in Cambodia, Laos and Vietnam: A Regional View, paper presented at IMF Conference on Foreign Direct Investment, Hanoi.
Friedman J., Gerlowski D. and Silberman J. (1992), 'What attracts foreign multinational corporations? Evidence from branch plant location in the United States', Journal of Regional Science, 32, 4, 403-18.
Fujita Mai, (2000) Foreign Direct Investment, Trade, and Vietnam’s Interdependence in the APEC Region, Chaper 2, in Satoru Okuda (ed.) Industrial Linkage and Direct Investment in APEC, APEC Study Center, Institute of Developing Economies.
Glickman N.J. and Woodward D.P. (1988), 'The Location of Foreign Direct Investment in the United States: Patterns and Determinants', International Regional Science Review, 11, 2, 137-54.
Görg H., and D., Greenaway (2004) Much Ado about othing? Do Domestic Firms Really Benefit from Foreign Direct Investment? The World Bank Research Observer, vol. 19 (2), pp. 171–197
Greene W. (1997) Econometric Analysis. Prentice-Hall International, Inc.
Greenhut M.L. (1957), 'Games, capitalism and general location theory ', in Greenhut (ed.), Location Economics - Theoretical Underpinnings and Applications (1995). Aldershot: Economists of the Twentieth Century.
Greenhut M.L (1964), 'The two sides of locational economics', in Greenhut (ed.), Location Economics - Theoretical Underpinings and Application (1995). Aldershot: Economists of the Twentieth Century.
GSO (1995-2006), Vietnam’s Statistical Year Book, Statistical Publishing House.
GSO, (2006), Press Release of Socio-Economic Statistics in 2006, (in Vietnamese) http://www.gso.gov.vn/default.aspx?tabid=507&ItemID=5733 accessed on 20 March 2007
Head K., Ries J. and Swenson D. (1995), 'Agglomeration benefits and location choice: Evidence from Japanese manufacturing investments in the United States', Journal of International Economics, 38, 223-47.
Hill S. and Munday M. (1992), 'The UK Regional Distribution of Foreign Direct Investment: Analysis and Determinants', Regional Studies, 26, 6, 535-44.
Hill S and Munday M. (1994), The regional distribution of foreign manufacturing investment in the UK. London: Macmillan.
Hood N. and Young S. (1984), The Economics of Multinational Enterprise. London: Longman.
Hood N. and Truijens T. (1993), European Locational Decisions of Japanese Manufacturers: Survey Evidence on the Case of the UK', International Business Review, 2, 1, 39-63.
Huallachain B.O. and Reid N. (1997), 'Acquisition versus Greenfield Investment: The Location and Growth of Japanese Manufacturers in the United States', Regional Studies, 31, 4, 403-16.
Hsieh Wen-Jen (2005), The Determinants of Foreign Direct Investment in Southeast Asian Transition Countries, paper presented at National Cheng Kung University.
Hymer S. H. (1976) The International Operations of National Firms: A Study of Direct Foreign Investment. Cambridge: MIT Press.
Kindleberger C. (1969) American Business Abroad, Yale University Press Kwang W., D., Pham., V., Kwakwa, Kyle P., and Thang-Long Ton (1997) Foreign Capital Flows In Vietnam: Trend, Impact, And Policy Implications, Background Paper for the World Bank’s Economic Report “Vietnam: Deepening Reform for Growth.”
Le Dang Doanh (2002) Foreign Direct Investment in Vietnam: Results, Achievements, Challenges and Prospect, paper presented at IMF Conference on Foreign Direct Investment, Hanoi.
Le Thanh Thuy (2005), Technological spillovers from foreign direct investment: The case of Vietnam, mimeo, Graduate School of Economics, University of Tokyo.
Le Viet Anh (2002), FDI-Growth Nexus in Vietnam, mimeo, Graduate School of International Development, Nagoya University.
Meyer, Klaus and Nguyen, H.V. (2005), Foreign Investment Strategies and Sub-national Institutions in Emerging Markets: Evidence from Vietnam. Journal of Management Studies, Vol. 42, No. 1, pp. 63-93
Mirza Hafiz and Axele Giroud (2003), The Impact of Foreign Direct Investment on the Economic Development of ASEAN Economy – A Preliminary Analysis, paper presented at EAMSA 20th Annual Conference, Stockholm School of Business.
Mirza Hafiz and Axele Giroud (2004) Regional Integration and Benefits from Foreign Direct Investment in ASEAN Countries: The Case of Vietnam, Asian Development Economic Review, Vol. 21 (1), pp. 66-98.
Morris J. (1989), 'The who, why, and where of Japanese manufacturing investment in the UK', Industrial Relations Journal, 19, 31-40.
Morris J. (1987), 'Industrial restructuring, foreign direct investment, and uneven development: the case of Wales' Environment and Planning A, 19, 205-224.
Nguyen Nhu Binh and Jonathan Haughton, (2002), Trade Liberalisation and Foreign Direct Investment in Vietnam, ASEAN Economic Bulletin, Vol. 19(3), pp. 302-318.
Nguyen Phi Lan (2006), Foreign Direct Investment in Vietnam: Impact on Economic Growth and Domestic Investment, mimeo, Centre for Regulation and Market Analysis, University of South Australia.
Nguyen Ha Thanh, Hung Vo Nguyen and Klaus E. Meyer, (2002) Foreign Direct Investment in Vietnam, mimeo, London Business School.
Nguyen Thi Phuong Hoa (2002) Contribution of Foreign Direct Investment to Poverty reduction: The case of Vietnam, mimeo,
Nguyen Thanh Xuan and Yuqing Xing (2006), Foreign Direct Investment and Exports: The Experience of Vietnam, Working Paper No. EDP06-11, Graduate School of International Relations, International University of Japan.
Nguyen, Thang. (2004) ‘Vietnam’, Report to Overseas Development Institute, Accessed at http://www.odi.org.uk/iedg/Projects/Doha/05Poverty_Impact_Doha_Vietnam.pdf
Overseas Development Institute (1997), Foreign Direct Investment Flows to Low-Income Countries: A Review of Evidence, Briefing Paper, No. 3.
Pham Hoang Mai (2001), The Export Performance of Foreign-Invested Enterprises in Vietnam, ASEAN Economic Bulletin, Vol 18(3), pp. 263-275.
Pham Hoang Mai (2002), Regional Economic Development and Foreign Direct Investment Flows in Vietnam, 1988-98, Journal of the Asia Pacific Economy, Vol. 7(2), pp. 182-202.
Pham Hoang Mai (2003), The Economic Impact of Foreign Direct Investment Flows on Vietnam: 1988-98, Asian Studies Review, Vol. 2791), pp. 81-98.
Phan Minh Ngoc and Eric Ramstetter (2006), Economic growth, Trade and Multinational Presence in Vietnam’s province, mimeo, The International Center for the Study of East Asian Development, Kitakyushu University.
Reid, N. (1990), Spatial patterns of Japanese investment in the US automobile industry', Industrial Relations Journal, 48-59.
Runckel Christopher (2005), Asia Focus - Location, Location, Location: Asian Comparison, Wire Journal of International Magazine, November. http://www.business-in-asia.com/wire_journal_nov2005.html
Runckel Christopher (2006) Vietnam – Open for Business? http://www.business-in-asia.com/vn_industrial.html
Smith, D.M. (1991), Neoclassical location theory, in Lever W.F., (ed.) Industrial change in the United Kingdom, Longman Scientific & Technical.
Smith, D.M (1981), Industrial Location. New York:John Wiley & Sons.
Stone, I. and Peck, F. (1996) 'The foreign-owned manufacturing sector in UK peripheral regions, 1978-1993: Restructuring and Comparative performance', Regional Studies, 30, 1, 55-68.
Storper, M. (1981), 'Toward a Structural Theory of Industrial Location', in Rees J, Hewings G.J.D and Stafford H.A (eds), Industrial Locations and regional System. London: Croom Helm.
Schaumburg-Müller (2003) Rise and Fall of Foreign Direct Investment in Vietnam and its Impact on Local Manufacturing Upgrading, The European Journal of Development Research, Vol.15 (2), pp.44–66.
Taylor, J. (1993) An analysis of the Factors Determining the Geographical Distribution of Japanese Manufacturing Investment in the UK, 1984-91, Urban Studies, 30, 7, 1209-24.
Thoburn J., (2004), Introduction and Overview, Journal of the Asia Pacific Economy, Special Issue: Globalisation and Poverty Reduction in Vietnam, Vol 9(2), pp. 127-144.
Tran Van Tho (2004), Foreign Direct Investment and Development of Supporting Industries in Vietnam, Obirin Daigaku Sangyokenkuyui-nenpo (Annual Bulletin of the Institute for Industrial Research of Obirin University), No. 22, pp. 173-204.
Vernon R. (1966) 'International Investment and International Trade in the Product Cycle', Quarterly Journal of Economics, 80, 190-207.
Vernon R. (1979), 'The Product Cycle Hypothesis in an New International Environment', Oxford Bulletin of Economics and Statistics, 41.
Vu Bang Tam, Gangnes Byron and Ilan Noy (2006), Is Foreign Direct Investment Good for Growth? Evidence from Sectoral Analysis of China and Vietnam, mimeo, Department of Economics, University of Hawaii-Manoa.
Winters, A., McCulloch, N. and McKay, A. (2002) ‘Trade Liberalisation and Poverty: The Empirical Evidence’, Discussion Paper 88, School of Social Sciences, University of Sussex.
Wood P.A., (1991) Behavioural approaches to industrial location studies, in Lever W.F., (ed.) Industrial change in the United Kingdom, Longman Scientific & Technical.
Woodward D.P. (1992) ' Locational determinants of Japanese Manufacturing Start-ups in the United States', Southern Economic Journal, 58, 690-708.