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RESEARCH

JOURNAL PUBLICATIONS

Tusha, D., & Jordaan, J. A. (2021). Biased FDI spillovers in incomplete datasets: An empirical examination. Review of Development Economics, 25(2), 582-600.

WORKING PAPERS

How do FDI characteristics and labor market conditions affect productivity spillovers? Evidence from Moldova, with Shawn W. Tan. (revise and resubmit at The World Economy)

We use firm-level administrative panel data and annual region-sector survey indicators of labour market conditions in 2005-2014 to estimate productivity spillovers from foreign to domestic firms through the labour market in Moldova. Baseline regressions show that domestic firms benefit from backward FDI spillovers, while we find no evidence of horizontal or forward spillovers. Spillover effects are heterogeneous and depend on foreign firm characteristics, such as ownership structure and age. Domestic firms in upstream sectors benefit from both fully foreign firms and joint ventures. However, joint ventures need less time in the market for positive spillovers to materialise, while fully foreign firms only lead to signicant spillovers when they are older. In regions and sectors where firms experience fewer labour market restrictions, backward FDI spillovers are larger. Interacting foreign firm characteristics with labour market restrictions, we find that older fully foreign firms generate positive backward and forward FDI spillovers, and the latter are larger for more flexible labour markets. Our findings suggest that in developing countries less labour mobility reduces the size of inter-, rather than intra-industry FDI spillovers. (Latest draft version here)

Corruption and Firm Productivity: Empirical Evidence from Moldova, with Shawn W. Tan. (under review at Review of Development Economics)
 

We examine the effects of corruption on firm productivity in Moldova in 2005-2015 using administrative firm-level panel data merged with two sector-region measures of corruption. The paper finds that bribery affects labour productivity directly, while inspections prevent rms from investing in more productive capital. A unit increase in the difficulties with bribery score decreases labor productivity by 5.2 percent, while a unit increase in the difficulties with inspection score decreases tangible assets investment by 7.2 percent and intangible assets investment by 9.6 percent. The results also show that state-owned enterprises are insulated from the negative effects of corruption, while there is no heterogeneous effect for large or foreign firms.

Technology gap, heterogeneous measures of FDI exposure, and FDI spillovers.

We investigate the relationship between FDI spillovers and the technological gap between foreign and domestic firms in Indonesia. We do away with the implicit assumption of linearity by estimating an endogenous threshold regression analysis to capture the complete dynamics between the technology gap and FDI spillovers. We also introduce heterogeneity in the level of FDI exposure of domestic firms, by making this dependent on the level of productivity of the domestic firm itself. As such, we introduce a new measure of FDI exposure that captures only those foreign firms in the industry that are more productive than domestic firms. Our findings offer support for our hypothesis that there is heterogeneity in productivity distributions, and a non-linear relationship characterized by single or double thresholds is more appropriate.

POLICY PAPERS

FDI Spillovers and the Role of Labor Market Restrictions in Moldova, with Shawn W. Tan.

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  • Background paper for The World Bank. (2019). A New Lens on Moldova's Private
    Sector. Washington, D.C.

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Vertical linkages with foreign firms in a GVC perspective: Evidence from Vietnam, with Jacob Jordaan and Adnan Seric.

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  • Background paper for UNIDO. (2018). Global value chains and industrial development: Lessons from China, South-East and South Asia. Vienna.
     

  • OECD-UNIDO. (2019). Integrating Southeast Asian SMEs in Global Value Chains:
    Enabling Linkages with Foreign Investors. Paris.

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WORK IN PROGRESS

FDI local sourcing determinants: Evidence from Moldova, with Shawn W. Tan.


Agglomeration and Firm Performance in Kazakhstan, with Shawn W. Tan.


FDI spillovers in knowledge-intensive industries: Evidence from Bulgaria.

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