What Caused the Recent Surge of FDI into Japan?

Hi-Stat Discussion Paper No. 31

28 Pages Posted: 28 Feb 2006

See all articles by Ralph Paprzycki

Ralph Paprzycki

Hitotsubashi University - Institute of Economic Research

Date Written: April 2004


In recent years, foreign direct investment (FDI) in Japan has jumped to unprecedented levels. This paper examines the underlying reasons, looking at both the international factors - the global boom in FDI and mergers & acquisitions(M&A) during 1998-2000 - and domestic regulatory, structural and other changes. It is argued that while domestic changes created the necessary conditions for Japan to participate in the global M&A boom, FDI inflows failed to develop a momentum of their own. Thus, rather than the result of a sudden transformation of the country into a major destination for global FDI flows, the recent surge in Japan was primarily driven by global trends.

Keywords: Japan, foreign direct investment, structural change, policy

JEL Classification: F00, F20, F22, F23

Suggested Citation

Paprzycki, Ralph, What Caused the Recent Surge of FDI into Japan? (April 2004). Hi-Stat Discussion Paper No. 31, Available at SSRN: https://ssrn.com/abstract=885983 or http://dx.doi.org/10.2139/ssrn.885983

Ralph Paprzycki (Contact Author)

Hitotsubashi University - Institute of Economic Research ( email )

2-1 Naka Kunitachi-shi
Tokyo 186-8306

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