Journal Press India®

FDI Inflows in India: An Analysis of Source Country Factors with Special Reference to Tax Havens

Vol 2, Issue 2, July - December 2015 | Pages: 62-79 | Research Paper  

 
Article has been added to the cart.View Cart (0)
https://doi.org/10.17492/vision.v2i2.10181


Author Details ( * ) denotes Corresponding author

1. * Harmanpreet Kaur, Research Scholar, Department of Commerce, Delhi School of Economics, University of Delhi, Delhi, India (kaur.harmanpreet01@gmail.com)

This study examines the impact of source country factors on the inflow of foreign direct investment (FDI) into India between 2004 and 2013 with special reference to tax havens. In this paper, the FDI inflows in India are considered as function of relative GDP, relative GDP per capita, inflation, FDI openness, relative tax rates and tax haven dummy. The multiple regression (fixed effects) model on panel data is employed to identify the determinants of FDI inflows from top 20 source countries in India. The empirical results indicate that relative GDP per capita, source country FDI openness and inflation significantly affects FDI inflows in India. The results also verify that tax havens have special role to play.

Keywords

Foreign Direct Investment, Source country factors, Tax havens

  1. Banga, R. (2000).Drivers Of Outward Foreign Direct Investment from Asian Developing Economies. Implications of General Agreement on Trade in Services (GATS) for Asia-Pacific Economies, UNESCAP. NY: United Nations Publications.
  2. Bhasin, N., & Jain, V. (2013). Home Country Determinants of Outward FDI: A Study of Select Asian Economies. Retrieved from SSRN website: http://dx.doi.org/10.2139/ssrn.2206739 on 20th May 20115
  3. Dunning, J. H. (1988). Multinationals, Technology and Competitiveness. London: Unwin Hyman.
  4. Dunning, J. H. (1998). Location and the Multinational Enterprises: A Neglected Factor? Journal of International Business Studies, 29(1), 45–66
  5. Das, K. C. (2013). Home Country Determinants of Outward FDI from Developing Countries. Margin—The Journal of Applied Economic Research , 7 (1), 93–116. doi:10.1177/0973801012466104
  6. Frenkel, M. , Funke, K. , & Stadtmann, G. (2004). A Panel Analysis of Bilateral FDI Flows To Emerging Economies. Economic Systems, 28, 281-300.
  7. Gravelle, J. G. (2015). Tax havens: International tax avoidance and evasion. Retrieved from https://www.fas.org/sgp/crs/misc/R40623.pdf
  8. Grosse, R., & Trevino, L. J. (1996). Foreign Direct Investment in the United States: An Analysis by Country of Origin. Journal of International Business Studies, 27 (1), 139–55.
  9. Hymer, S. H. (1960). The International Operations of National Firms: A Study of Direct Investment. Ph.D. Thesis, Massachusetts Institute of Technology, Cambridge, MA. Published in 1976 by MIT Press: Cambridge, MA.
  10. Kayam, S. S. (2009). Home Market Determinants Of FDI Outfows From Developing And Transition Economies. MPRA Paper No. 16781, retrieved from: http://mpra.ub.uni-muenchen.de/16781/ on 30th May 2015
  11. Kimino, S. , Saal, D. S. & Driffield, N. (2007). MacroDeterminants of FDI Inflows to Japan: An Analysis of Source Country Characteristics. World Economy, 30 (3), 446-469. doi: 10.1111/j.1467-9701.2007.01001.x
  12. Kyrkilis, D. , & Pantelidis, P. (2003). Macroeconomic Determinants of Outward Foreign Direct Investment. International Journal of Social Economics, 30 (7), 827–36.
  13. Liu, W. H. (2010). Determinants of FDI Inflows to China: An Empirical Analysis of Source Country Characteristics. Taipei International Conference on Growth, Trade and Dynamics.
  14. Masron, T. A. , & Shahbudin, A. S. (2010). Push Factors’ of Outward FDI: Evidence from Malaysia and Thailand. Journal of Business & Policy Research, 5 (1), 54 – 68.
  15. Pan, Y. (2003). The Inflow of Foreign Direct Investment to China: The Impact of Country-specific Factors. Journal of Business Research, 56 (10), 829–33.
  16. Tallman, S. B. (1988). Home Country Political Risk and Foreign Direct Investment in the United States. Journal of International Business Studies, 19 (2), 219–34.
  17. Thomas, D. E. , & Grosse, R. (2001). Country-of-Origin Determinants of Foreign Direct Investment in an Emerging Market: The Case of Mexico. Journal of International Management, 7 (1), 59–79.
  18. Tolentino, P. E. (2008). The Determinants Of The Outward Foreign Direct Investment Of China And India: Whither The Home Country? UNU-MERIT Working Paper Series 049, United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology. doi: http://eprints.bbk.ac.uk/10772/
  19. United Nations Conference on Trade and Development (UNCTAD). (2015). Reforming International Investment Governance. Geneva: United Nations.
  20. Zhao, H. (2003). Country Factor Differentials as Determinants of FDI Flow to China. Thunderbird International Business Review, 45 (2), 149–69.
  21. Zheng, P. (2009). A Comparison of FDI determinants in China and India. Thunderbird International Business Review, 51 (3), 263–279. doi: 10.1002/tie.20264.
Abstract Views: 184
PDF Views: 106

Advanced Search

News/Events

Institute of Managem...

Deccan Education Society Institute of Management Development and Re...

S.B. Patil Institute...

Pimpri Chinchwad Education Trust's S.B. Patil Institute of Mana...

D. Y. Patil IMCAM, A...

D. Y. Patil Institute of Master of Computer Applications & Managem...

Vignana Jyothi Insti...

Vignana Jyothi Institute of Management International Conference on ...

Department of Commer...

Department of Commerce, Faculty of Commerce & Business, University...

Birla Institute of M...

Birla Institute of Management Technology (BIMTECH) 3rd Pritam Singh M...

OP Jindal University...

OP Jindal University, India 4th International Conference on  ...

Department of MBA, N...

Department of MBA, Narayana Engineering College Nellore International...

Vignana Jyothi Insti...

Vignana Jyothi Institute of Management Conference Proceedings,...

Online Proceedings R...

Conference Proceedings, March 2023 ISBN: 978-81-956810-6-8 ...

By continuing to use this website, you consent to the use of cookies in accordance with our Cookie Policy.