search query: @indexterm FOREIGN INVESTMENT / total: 1949
reference: 77 / 1949
| Author: | Schiavo, S. |
| Title: | Common currencies and FDI flows |
| Journal: | Oxford Economic Papers
2007 : JUL, VOL. 59:3, p. 536-560 |
| Index terms: | currency EMU European monetary system foreign investment monetary policy OECD |
| Freeterms: | FDI |
| Language: | eng |
| Abstract: | This article examines how EMU has influenced on foreign direct investment flows. Exchange rate uncertainty has a negative effect on cross-border investment flows; therefore, increase in international investments could be expected from fixing the exchange rates. Using a gravity model on a sample of OECD countries, this hypothesis is confirmed. The currency union boosts FDI. Besides eliminating the exchange rate uncertainty, the same currency seems to have other positive effects as well. |
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