Naslov
The interaction of real exchange rate and FDI sectoral structure in Croatia

Autori
Kusanović, Tino ; Pečarić, Mario ; Jakovac, Pavle

Vrsta, podvrsta i kategorija rada
Radovi u zbornicima skupova, cjeloviti rad (in extenso), znanstveni

Izvornik
Proceedings of 10th International Scientific Symposium „Region, Entrepreneurship, Development - RED 2021” / Leko Šimić, Mirna ; Crnković, Boris - Osijek : Ekonomski fakultet Sveučilišta Josipa Jurja Strossmayera u Osijeku, 2021, 148-164

Skup
10th International Scientific Symposium Region, Entrepreneurship, Development (RED 2021)

Mjesto i datum
Online, 17.06.2021

Vrsta sudjelovanja
Predavanje

Vrsta recenzije
Međunarodna recenzija

Ključne riječi
real exchange rate, FDI sectoral structure, VAR model, Croatia

Sažetak
The aim of this paper is to analyze the theoretical and empirical interaction between real exchange rate and the FDI sectoral structure in Croatia. Specifically, research to date has highlighted the generally more significant impact of FDI inflows on economic growth in the manufacturing sector, due to spillover effects, than in the service sector. Previous research has shown that total FDI inflow in Croatia has a statistically insignificant effect on economic growth, while economic growth has a statistically significant effect on FDI inflow, primarily in the service sector. The assumed direction of influence is explained as follows: in the situation of liberalization of the capital flows, the FDI sectoral structure in Croatia is determined, inter alia, by movements in the real exchange rate of the domestic currency. The real exchange rate appreciation in the middle-income countries increases import-oriented consumption and thus attracts mainly FDI to the service sector with little, or even negative impact on economic growth. Based on theoretical insights, empirical analysis was conducted using VAR analysis on quarterly data from Q1/2000 - Q3/2020. Analysis confirmed the assumed relationship that appreciation of the real exchange rate had a positive and more prolonged effect on FDI inflows into the service sector than into manufacturing sector, while the impact of the FDI inflows in the service and manufacturing sector on the GDP growth rate is mostly negative.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

Napomena
All accepted papers, as usual will be published in
conference proceeding with ISSN on USB
stick and will be sent for evaluation to Clarivate
Analitics.

POVEZANOST RADA