Gifted Kids or Pushy Parents? Foreign Acquisitions and Plant Productivity in Indonesia

摘要: There exists a vast empirical literature searching for the evidence of knowledge spillovers from foreign direct investment (FDI). Implicit to this analysis lies assumption that ownership per se conveys some intangible advantage whose proximity can be beneficial domestic firms. Yet there is no robust confirmation holds, particularly in context developing countries. This paper uses data Indonesian Census Manufacturing analyze causal link between and productivity. To control possible endogeneity FDI troubles many existing studies, it employs matching technique difference differences approach. The results indicate has large positive effect on plant benefit realized very quickly, extent immediately after entry investor. also suggest rise productivity cannot attributed an increase capacity utilization but rather result restructuring, as acquired plants experience sharp increases outlays, employment output. Moreover, findings show leads greater integration into global economy through exports imports.