This paper investigates and compares the impacts of Free Trade Agreement (FTA) on the Foreign Direct Investment (FDI) flows in Korea, the US and Japan using the extended knowledge-capital model. Our results show that FTA accounts for a 47.4% increase in Korea s FDI inflows and a 67.2% increase in FDI outflows, while it accounts for a 166.4% increase in US FDI inflows and a -18.3% decrease in Japanese FDI outflow. Key variables in Korea such as labor freedom, security apparatus and E-govemment influence Korea s FDI inflow and outflow, while their impacts on the US and Japanese FDI flows are ambiguous.
Abstract
Ⅰ. Introduction
Ⅱ. Literature Review
Ⅲ. Theoretical backgrounds of FTA and FDI
Ⅳ. Model and Data
Ⅴ. Empirical Results and Analysis
Ⅵ. Conclusions and Policy Recommendations
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