Greenfield Investments, Cross-Border M&As, and Economic Growth in Emerging Countries
Economics and Business Letter, Vol 5, Issue 3, 2016
10 Pages Posted: 4 Mar 2016 Last revised: 25 Nov 2016
Date Written: September 1, 2016
This paper investigates the effect of foreign direct investment (FDI) on economic growth in emerging countries through its two major entry modes: Greenfield investments and cross-border merger and acquisitions (M&As). We found that both Greenfields and M&As contribute positively to accelerate growth. Besides, emerging countries could obtain more benefits from Greenfields and M&As if the human capital levels are enhanced. We also found that while growth did not have any significant impact on Greenfields level, lower economic growth could lead to higher M&A flows.
Keywords: Cross-border M&As, Greenfield Investment, Economic Growth, Emerging Countries
JEL Classification: F21, O40, C36
Suggested Citation: Suggested Citation