The Impact of Trade and Investment Agreements on Australia's Inward FDI Flows

17 Pages Posted: 1 Jan 2011

See all articles by Simon Crotti

Simon Crotti

affiliation not provided to SSRN

Tony Cavoli

University of Adelaide

John K. Wilson

University of South Australia - School of Commerce

Abstract

International trade and investment agreements are one of the primary instruments of global financial liberalisation. They are enacted to enhance the flows of foreign direct investment (FDI) between signatories by reducing regulatory barriers to investment; promoting stable host investment environments; and guaranteeing investors against non-commercial risk. As a net capital importer, Australia has sought to attract FDI through participation in such accords since the early 1980s. This paper examines the determinants of Australia's inward FDI flows - focussing specifically on the effects of trade and investment agreements. Using panel data, we find that both bilateral trade and bilateral and multilateral investment agreements attract FDI flows into Australia, thereby indicating that the policy of enticing FDI through participation in these accords is quite possibly effective.

Suggested Citation

Crotti, Simon and Cavoli, Tony and Wilson, John K., The Impact of Trade and Investment Agreements on Australia's Inward FDI Flows. Australian Economic Papers, Vol. 49, No. 4, pp. 259-275, 2010, Available at SSRN: https://ssrn.com/abstract=1732926 or http://dx.doi.org/10.1111/j.1467-8454.2010.00401.x

Simon Crotti

affiliation not provided to SSRN

No Address Available

Tony Cavoli (Contact Author)

University of Adelaide ( email )

233 North Terrace
Adelaide, South Australia
Australia
(+61 8) 8303 4507 (Phone)
(+61 8) 8223 1460 (Fax)

HOME PAGE: http://www.economics.adelaide.edu.au/pg/students/

John K. Wilson

University of South Australia - School of Commerce ( email )

37-44 North Terrace
Adelaide SA 5000, South Australia 5001
Australia

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