Shaking up Foreign Finance: FDI in a Post-Disaster World
Résumé
This study investigates which effect earthquakes have on the inflow of foreign direct investment (FDI) within a country from a temporal, spatial and sectoral dimension. It uses a dynamic difference-indifference model of physical disaster exposure in 416 Indonesian districts between 2003 and 2019 in order to quantify the impact on investment behavior from abroad. Drawing geolocated data from a variety of sources, the results indicate that FDI inflows are temporarily reduced of around 90% in the year after the disaster. In this case study, spatial effects play a subordinate role, yet earthquake shocks affecting upstream industries tend to have substantial negative effects. Manufacturing appears to be the most affected sector.
Domaines
Economies et financesOrigine | Fichiers produits par l'(les) auteur(s) |
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