Imports, FDI Spillovers and Firm Performance

Anwar Adem

doi:10.1111/roie.12779

Imports, FDI Spillovers and Firm Performance

Research output: Contribution to journal › Article › peer-review

Abstract

This paper investigates the productivity effects of the number of inputs a firm chooses to import. It also analyses how accounting for the productivity gains from imported inputs affects foreign direct investment (FDI) spillover. The identification of the gains from imports comes from comparing productivity differences among firms that use different numbers of imported inputs, all else being equal. Using a firm-level dataset, I find a positive gain from imported inputs for both domestic and foreign-owned firms with the magnitude being larger for the latter. Moreover, I find a positive horizontal FDI spillover; whereas, the results for backward and forward spillovers seem mixed. Finally, I find little evidence suggesting accounting for the productivity effects of imported inputs affects gains from foreign presence. This indicates that productivity gains from imported inputs and FDI spillover are different and unrelated.

Original language	English
Pages (from-to)	352 - 368
Number of pages	17
Journal	Review of International Economics
Volume	33
Early online date	21 Nov 2024
DOIs	https://doi.org/10.1111/roie.12779
Publication status	Published - 9 Apr 2025

Bibliographical note

© 2024 The Author(s). Review of International Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

Data Access Statement

The data that support the findings of this study are available from the Central Statistical Agency of Ethiopia. Restrictions apply to the availability of these data, which were used under license for this study. Data are available from https://www.statsethiopia.gov.et/ with the permission of the Central Statistical Agency of Ethiopia.

Funding

Economic and Social Research Council (ESRC) under the ESRC NWDTC Standard Studentship (Award Ref: 1720769)

Keywords

foreign direct investment
imported inputs
productivity
spillovers

Access to Document

10.1111/roie.12779

Rev International Economics - 2024 - Adem - Imports FDI Spillovers and Firm Performance
© 2024 The Author(s). Review of International Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
Final published version, 1.04 MBLicence: CC BY 4.0

Cite this

@article{3d04a5d727874131a8a9722dc246a2e0,

title = "Imports, FDI Spillovers and Firm Performance",

abstract = "This paper investigates the productivity effects of the number of inputs a firm chooses to import. It also analyses how accounting for the productivity gains from imported inputs affects foreign direct investment (FDI) spillover. The identification of the gains from imports comes from comparing productivity differences among firms that use different numbers of imported inputs, all else being equal. Using a firm-level dataset, I find a positive gain from imported inputs for both domestic and foreign-owned firms with the magnitude being larger for the latter. Moreover, I find a positive horizontal FDI spillover; whereas, the results for backward and forward spillovers seem mixed. Finally, I find little evidence suggesting accounting for the productivity effects of imported inputs affects gains from foreign presence. This indicates that productivity gains from imported inputs and FDI spillover are different and unrelated.",

keywords = "foreign direct investment, imported inputs, productivity, spillovers",

author = "Anwar Adem",

note = " {\textcopyright} 2024 The Author(s). Review of International Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.",

year = "2025",

month = apr,

day = "9",

doi = "10.1111/roie.12779",

language = "English",

volume = "33",

pages = "352 -- 368",

journal = "Review of International Economics",

issn = "0965-7576",

}

TY - JOUR

T1 - Imports, FDI Spillovers and Firm Performance

AU - Adem, Anwar

N1 - © 2024 The Author(s). Review of International Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

PY - 2025/4/9

Y1 - 2025/4/9

N2 - This paper investigates the productivity effects of the number of inputs a firm chooses to import. It also analyses how accounting for the productivity gains from imported inputs affects foreign direct investment (FDI) spillover. The identification of the gains from imports comes from comparing productivity differences among firms that use different numbers of imported inputs, all else being equal. Using a firm-level dataset, I find a positive gain from imported inputs for both domestic and foreign-owned firms with the magnitude being larger for the latter. Moreover, I find a positive horizontal FDI spillover; whereas, the results for backward and forward spillovers seem mixed. Finally, I find little evidence suggesting accounting for the productivity effects of imported inputs affects gains from foreign presence. This indicates that productivity gains from imported inputs and FDI spillover are different and unrelated.

AB - This paper investigates the productivity effects of the number of inputs a firm chooses to import. It also analyses how accounting for the productivity gains from imported inputs affects foreign direct investment (FDI) spillover. The identification of the gains from imports comes from comparing productivity differences among firms that use different numbers of imported inputs, all else being equal. Using a firm-level dataset, I find a positive gain from imported inputs for both domestic and foreign-owned firms with the magnitude being larger for the latter. Moreover, I find a positive horizontal FDI spillover; whereas, the results for backward and forward spillovers seem mixed. Finally, I find little evidence suggesting accounting for the productivity effects of imported inputs affects gains from foreign presence. This indicates that productivity gains from imported inputs and FDI spillover are different and unrelated.

KW - foreign direct investment

KW - imported inputs

KW - productivity

KW - spillovers

UR - https://onlinelibrary.wiley.com/doi/10.1111/roie.12779

U2 - 10.1111/roie.12779

DO - 10.1111/roie.12779

M3 - Article

SN - 0965-7576

VL - 33

SP - 352

EP - 368

JO - Review of International Economics

JF - Review of International Economics

ER -

Imports, FDI Spillovers and Firm Performance

Abstract

Bibliographical note

Data Access Statement

Funding

Keywords

Access to Document

Other files and links

Fingerprint

Cite this