Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports

Research output: Working paperResearch

Standard

Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports. / Sørensen, Bjørn Bo.

WIDER Working Paper 2020/3. ed. Helsinki : World Institute for Development Economic Research (UNU-WIDER), 2020.

Research output: Working paperResearch

Harvard

Sørensen, BB 2020 'Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports' WIDER Working Paper 2020/3 edn, World Institute for Development Economic Research (UNU-WIDER), Helsinki.

APA

Sørensen, B. B. (2020). Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports. (WIDER Working Paper 2020/3 ed.) Helsinki: World Institute for Development Economic Research (UNU-WIDER).

Vancouver

Sørensen BB. Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports. WIDER Working Paper 2020/3 ed. Helsinki: World Institute for Development Economic Research (UNU-WIDER). 2020 Jan.

Author

Sørensen, Bjørn Bo. / Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports. WIDER Working Paper 2020/3. ed. Helsinki : World Institute for Development Economic Research (UNU-WIDER), 2020.

Bibtex

@techreport{a981b71fea2f4ba285a991b2cc44bb7d,
title = "Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports",
abstract = "Countries’ economic complexity, and the associated diversification and sophistication of their exports, is a key determinant of economic growth. Understanding how South African firms learn to export more sophisticated products is, therefore, an important policy issue. Using administrative data covering the entire tax-paying population of firms in South Africa, we argue that foreign direct investment can stimulate export upgrading in manufacturing firms. We find that the level of sophistication of the most complex product exported by local firms increases in tandem with the presence of multinational enterprises located in upstream, supplying sectors within the same province. The study is the first within the associated literature to (i) provide firmlevel evidence of export upgrading induced by foreign direct investment in Africa, (ii) employ the fitness algorithm to measure export complexity, and (iii) detect spillover effects from foreign direct investment materializing at the top line of domestic firms’ export basket.",
keywords = "Faculty of Social Sciences, foreign direct investment (FDI), economic complexity, spillovers, export upgrading, manufacturing, South Africa",
author = "S{\o}rensen, {Bj{\o}rn Bo}",
year = "2020",
month = "1",
language = "English",
publisher = "World Institute for Development Economic Research (UNU-WIDER)",
edition = "WIDER Working Paper 2020/3",
type = "WorkingPaper",
institution = "World Institute for Development Economic Research (UNU-WIDER)",

}

RIS

TY - UNPB

T1 - Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports

AU - Sørensen, Bjørn Bo

PY - 2020/1

Y1 - 2020/1

N2 - Countries’ economic complexity, and the associated diversification and sophistication of their exports, is a key determinant of economic growth. Understanding how South African firms learn to export more sophisticated products is, therefore, an important policy issue. Using administrative data covering the entire tax-paying population of firms in South Africa, we argue that foreign direct investment can stimulate export upgrading in manufacturing firms. We find that the level of sophistication of the most complex product exported by local firms increases in tandem with the presence of multinational enterprises located in upstream, supplying sectors within the same province. The study is the first within the associated literature to (i) provide firmlevel evidence of export upgrading induced by foreign direct investment in Africa, (ii) employ the fitness algorithm to measure export complexity, and (iii) detect spillover effects from foreign direct investment materializing at the top line of domestic firms’ export basket.

AB - Countries’ economic complexity, and the associated diversification and sophistication of their exports, is a key determinant of economic growth. Understanding how South African firms learn to export more sophisticated products is, therefore, an important policy issue. Using administrative data covering the entire tax-paying population of firms in South Africa, we argue that foreign direct investment can stimulate export upgrading in manufacturing firms. We find that the level of sophistication of the most complex product exported by local firms increases in tandem with the presence of multinational enterprises located in upstream, supplying sectors within the same province. The study is the first within the associated literature to (i) provide firmlevel evidence of export upgrading induced by foreign direct investment in Africa, (ii) employ the fitness algorithm to measure export complexity, and (iii) detect spillover effects from foreign direct investment materializing at the top line of domestic firms’ export basket.

KW - Faculty of Social Sciences

KW - foreign direct investment (FDI)

KW - economic complexity

KW - spillovers

KW - export upgrading

KW - manufacturing

KW - South Africa

M3 - Working paper

BT - Turnin’ it up a notch: How spillovers from foreign direct investment boost the complexity of South Africa’s exports

PB - World Institute for Development Economic Research (UNU-WIDER)

CY - Helsinki

ER -

ID: 236181079