Template-type: ReDif-Paper 1.0
Author-Name: Falvey R. 
Author-Name: Foster-McGregor N. 
Author-workplace-name: UNU-MERIT
Title: North-South FDI and Bilateral Investment Treaties
Abstract: Bilateral Investment Treaties BITs have become increasingly popular as a means of encouraging FDI from developed to developing countries. We adopt a matched difference-in-difference estimation to deal with the problem of endogeneity when estimating the effects of BITs on inward FDI. Our results indicate that forming a BIT with a developed country approximately doubles FDI inflows and stocks to developing countries on average, with a significant part of this arising from the development of new FDI relationships. The effects of BIT formation on FDI tend to  increase with the size and similarity of the host and source economies and BITs may be complementary to institutional quality in the host country.
Keywords: Single Equation Models, Quantile Regressions, International Investment, Long-term Capital Movements, North-South investment, FDI 
Classification-JEL: C21, F21
Series: UNU-MERIT Working Papers
Creation-Date: 2015
Number: 2015-010
File-URL: https://unu-merit.nl/publications/wppdf/2015/wp2015-010.pdf
File-Format: application/pdf
File-Size: 408906
Handle: RePEc:unm:unumer:2015010