Economic Impacts of Investment Facilitation
Date
2021-02
Authors
Balistreri, Edward J
Olekseyuk, Zoryana
Major Professor
Advisor
Committee Member
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
We quantify the impacts of a potential Investment Facilitation Agreement (IFA) given the outcomes of the structured discussions. The analysis is based on an innovative multi-region general equilibrium simulation model including bilateral representative firms. Consideration is given to Foreign Direct Investment (FDI) and monopolistic competition. The model shows empirically relevant gains associated with removal of investment barriers. The expected global welfare gains range between 0.56% and 1.74% depending on the depth of a potential IFA. The benefits are concentrated among the members with the highest welfare increase for the low and middle income countries. Notable spillovers accrue to non-participants, which can be increased by joining the agreement. Our results contribute to the relatively scarce research on investment facilitation and provide policy makers with information on the potential effects of an IFA.
Series Number
Journal Issue
Is Version Of
Versions
Series
21-WP 615
Academic or Administrative Unit
Type
Working Paper