The destination of outward FDI and the performance of South Korean multinationals

Research output: Contribution to journalArticle

8 Citations (Scopus)

Abstract

This paper examines how the destination of outward foreign direct investment (FDI) affects South Korean multinational parent firms. We categorize host countries into those that are developed and those that are less developed. We find that destination matters for employment and capital intensity. FDI into less developed countries is negatively associated with a firm's employment and positively associated with its capital intensity. However, FDI into developed countries does not seem to matter: the parent firm's activities do not change significantly after FDI has been made. These results may indicate that Korean FDI into less developed countries is a relocation of production lines to overseas affiliates and FDI into developed countries is done to extend markets.

Original languageEnglish
Pages (from-to)59-66
Number of pages8
JournalEmerging Markets Finance and Trade
Volume46
Issue number3
DOIs
Publication statusPublished - 2010 May 1

Fingerprint

Destination
Multinationals
Foreign direct investment
Outward foreign direct investment
Capital intensity
Less developed countries
Developed countries
Host country
Production line
Relocation

Keywords

  • foreign direct investment
  • multinationals
  • South Korea

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)
  • Finance

Cite this

The destination of outward FDI and the performance of South Korean multinationals. / Lee, Hongshik.

In: Emerging Markets Finance and Trade, Vol. 46, No. 3, 01.05.2010, p. 59-66.

Research output: Contribution to journalArticle

@article{ec027a1890b644d4b664c12bcda63e47,
title = "The destination of outward FDI and the performance of South Korean multinationals",
abstract = "This paper examines how the destination of outward foreign direct investment (FDI) affects South Korean multinational parent firms. We categorize host countries into those that are developed and those that are less developed. We find that destination matters for employment and capital intensity. FDI into less developed countries is negatively associated with a firm's employment and positively associated with its capital intensity. However, FDI into developed countries does not seem to matter: the parent firm's activities do not change significantly after FDI has been made. These results may indicate that Korean FDI into less developed countries is a relocation of production lines to overseas affiliates and FDI into developed countries is done to extend markets.",
keywords = "foreign direct investment, multinationals, South Korea",
author = "Hongshik Lee",
year = "2010",
month = "5",
day = "1",
doi = "10.2753/REE1540-496X460304",
language = "English",
volume = "46",
pages = "59--66",
journal = "Emerging Markets Finance and Trade",
issn = "1540-496X",
publisher = "M.E. Sharpe Inc.",
number = "3",

}

TY - JOUR

T1 - The destination of outward FDI and the performance of South Korean multinationals

AU - Lee, Hongshik

PY - 2010/5/1

Y1 - 2010/5/1

N2 - This paper examines how the destination of outward foreign direct investment (FDI) affects South Korean multinational parent firms. We categorize host countries into those that are developed and those that are less developed. We find that destination matters for employment and capital intensity. FDI into less developed countries is negatively associated with a firm's employment and positively associated with its capital intensity. However, FDI into developed countries does not seem to matter: the parent firm's activities do not change significantly after FDI has been made. These results may indicate that Korean FDI into less developed countries is a relocation of production lines to overseas affiliates and FDI into developed countries is done to extend markets.

AB - This paper examines how the destination of outward foreign direct investment (FDI) affects South Korean multinational parent firms. We categorize host countries into those that are developed and those that are less developed. We find that destination matters for employment and capital intensity. FDI into less developed countries is negatively associated with a firm's employment and positively associated with its capital intensity. However, FDI into developed countries does not seem to matter: the parent firm's activities do not change significantly after FDI has been made. These results may indicate that Korean FDI into less developed countries is a relocation of production lines to overseas affiliates and FDI into developed countries is done to extend markets.

KW - foreign direct investment

KW - multinationals

KW - South Korea

UR - http://www.scopus.com/inward/record.url?scp=77953838339&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=77953838339&partnerID=8YFLogxK

U2 - 10.2753/REE1540-496X460304

DO - 10.2753/REE1540-496X460304

M3 - Article

AN - SCOPUS:77953838339

VL - 46

SP - 59

EP - 66

JO - Emerging Markets Finance and Trade

JF - Emerging Markets Finance and Trade

SN - 1540-496X

IS - 3

ER -