Estimating Regional Trade Agreement Effects On Fdi In An Interdependent World

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___________,2010. Does Intratrade affect asset creation in Southeast Asia? Case Study of FTA`s Effect on FDI Flows indonesia, Malaysia and Thailand, The 44th Annual ASPAC International Conference, Portland State University, Oregon, USA, 18-20 June. This study attempts to analyse the impact of an intra-regional trade agreement on FDI flows in Southeast Asia. The agreement is the ASEAN Free Trade Area (AFTA). The countries observed are Indonesia, Malaysia and Thailand. These three countries were selected on the basis of several reflections. The Trade Indicators Revealed Comparative Advantage (RCA), Constant Market Share Analysis (CMSA) and Net Export (NX) show that these three countries have an intra-trade advantage over primary products. These indicators are useful for assessing AFTA`s effectiveness in including its member`s commercial benefit products in its priority list. In addition, this study attempts to assess the impact of AFTA on di entries as a proxy for its effectiveness on investments. This study uses an econometric model for analyzing panel data, both for solid static effects and for dynamic panel data analysis (DPD), to determine the impact of AFTA and other variables on FDI flows.

Recent research on trade and multinationals highlights a new problem with multinationals. In particular, their integration strategies are complex and the degree of vertical integration varies in a multilateral world with many possible places for action. Multinationals may choose some facilities to serve consumers only on the spot, while others trade. Overall, this could explain the fact that a high percentage of world trade is effectively controlled by multinationals, although most foreign FDI takes place within the bloc of industrialized countries. The main regional trade agreements (SAAs) are signed between members of the same economic bloc. Hence the question posed in this paper: what is the impact of FDI on foreign direct investment in an interdependent world? The document focuses on the role of the Europe Agreements between the Member States of the European Union and ten countries of Central and Eastern Europe. More recent spatial estimation techniques of HACs are applied to both estimation and testing. .