Regional Integration, Foreign Direct Investment and Income Convergence / Nadine A. Morris.



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Description based on online resource; title from PDF title page. Includes bibliographical references (pages 165-169). "A Dissertation Submitted to the Faculty of the Graduate School of HOWARD UNIVERSITY in partial fulfillment of the requirements for the degree of DOCTOR OF PHILOSOPHY, Department of Economics".

Title
Regional Integration, Foreign Direct Investment and Income Convergence / Nadine A. Morris.
Artist
Wadhawan, Satish, advisor.
Subjects
Language
English
Type
Book
Abstract
This research analyzes the dynamic impact of regional integration across regional blocs consisting of economies in different stages of development, the relationship between bilateral trade and foreign direct investment, and the impact of integration on the rate of income convergence within each regional group. The analysis covers 39 countries in four regional blocs, namely the ASEAN Free trade Area, CARICOM, the EU and NAFTA over the period 1985 to 2000. The impact of integration is examined within the framework of the gravity model using bilateral trade data and outward foreign direct investment stock. The results show that with the exception of the EU, trade diversion has occurred with higher levels of diversion occurring in the developing groups, namely ASEAN and CARICOM. The results also show that foreign direct investment is complementary to the volume of trade and that the volume of trade is sufficient to take advantage of comparative advantages that exist in the region. The other three regional groups however are not engaging in sufficient trade to adequately exploit existing comparative advantage within their respective regional groups. Over the period of the analysis, the CARICOM region displayed the highest levels of sigma convergence with σ falling from 0.7 to 0.43. The trends of convergence for the EU and NAFTA follow the trend of the world, though at significantly lower levels. The ASEAN free trade area did not display σ-convergence. Over the period of the analysis σ increased from 0.59 to 1.12.
Year
2008
Original Publisher(s)
Digital Publisher(s)