Interdependence between Manufacturing and Service Foreign Direct Investments of Korea

초록

In a view of constructing global value chains, this study attempts to examine interdependence between the outbound FDIs of the Korean manufacturing and producer service sectors, using panel data from 1996 to 2012. We find that (i) a presence of manufacturing FDIs has a positive effect on new investments in producer service sectors, and (ii) a presence of producer service FDIs also has a positive effect on new investments in manufacturing sectors. Our empirical results imply that Korean multinational firms are expanding their role as headquarter service providers in the world through both manufacturing plants and regional business service subsidiaries.

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