Camille Horvath (p)

Juan José de Lucio

See extended abstract

Trung Ngo Minh (p), Zoltán Gál

Camille Horvath

The empirical literature suggests that FDI plays an important role in supporting the economies of developing countries, but it faces an intensely competitive environment. The question is what makes regions attractive to foreign investors. The purpose of this paper is threefold: first, to assess the impact of FDI at the subnational level in the Vietnamese economy; second, to econometrically test the Provincial Competitiveness Index (PCI) from the point of view of investment promotion in the Vietnamese regions; and third, to further examine the index in terms of regions’ ability to attract FDI inflows and the spillover effects of FDI in different sectors. The specific case analyzed is Bac Ninh province, one of the largest hubs for FDI inflows in Vietnam. Using data on the Provincial Competitiveness Index (PCI), provincial-level time-series data on the Bac Ninh index will be compiled from 2006 to 2020. Using the
generalized method of the moments model, the results show that there are sub-variables of the index
that positively affect FDI inflows and some that do not. Finally, recommendations for investment promotion policies at the regional level are formulated.

Nelson Salazar (p), Pedro Caldentey del Pozo, María del Carmen Delgado López

Trung Ngo Minh

This article uses three gravity equations to achieve three goals: (1) the first is to explore whether or not there is evidence of trade creation or diversion between the countries that make up the Central American Customs Union, which includes El Salvador, Guatemala and Honduras; (2) the second is to estimate the effects of bilateral non-tariff barriers on intra-regional trade flows; (3) and the third is to examine the relationship between the commercialization of merchandise exempted from free circulation within the Central American territory, with total intra-regional export flows.

First, the article concludes that there is currently insufficient evidence to affirm that trade creation or diversion exists, and any indication of the presence of any of these phenomena is probably the consequence of factors unrelated to the customs union. Second, the article finds an inverse and statistically significant relationship between intra-regional exports and non-tariff barriers for all countries except Costa Rica. Therefore, the hypothesis that the presence of non-tariff barriers in intra-regional trade discourages such trade flows is ruled out. And finally, the article concludes that, due to the low relative weight of goods exempted from free circulation within the general flow of intra-regional exports, no level of exchange of these goods is statistically significant, and, therefore, has no influence on intra-regional exports of countries.

The paper contributes to the collective knowledge about the Central American intra-regional trade dynamics, and supports the work of regional economic integration as it provides evidence that supports the idea that despite the existence of tariff and non-tariff barriers to intra-regional trade, and despite the imperfections of the process of Central American economic integration itself, this process gradually progresses towards more and more mature and complete forms of economic integration, proving that, at least in the commercial area, Central America possesses a unique and attractive resilience and pragmatism.

Juan José de Lucio (p), Asier Minonda, Francisco Requena, Raúl Minguez

Nelson Salazar

Top exporters conditions the export specialization pattern and aggregate exports evolution at regional level. Our results show that, on average, 28 percent of aggregate exports in each province are in sectors in which the top exporter determines the revealed comparative advantage. Additionally, we show that sectors in which comparative advantage is determined by top exporter exhibit higher instability in the pattern of province export specialization over time.