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Foreign Exchange Rates and FDI Behavior of Multinational Enterprises Comparative Analysis Before and After the 1997 Korean Financial Crisis

Foreign Exchange Rates and FDI Behavior of Multinational Enterprises Comparative Analysis Before... This paper investigates whether the investment strategies of multinational enterprises MNEs have changed as a result of the 1997 financial crisis in Korea. Estimation results using balanced panel data indicate that the investment decisions of global MNEs seem to have changed following the crisis. The crisis seems to have served as a cold shower for MNEs making investment decisions, as they have taken exchange rate volatility into account to a greater extent following the crisis. In contrast, there is no robust evidence that the investment decisions of foreign investors are closely correlated with the level of exchange rate, either before or after the crisis. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Asia Business Studies Emerald Publishing

Foreign Exchange Rates and FDI Behavior of Multinational Enterprises Comparative Analysis Before and After the 1997 Korean Financial Crisis

Journal of Asia Business Studies , Volume 4 (2): 9 – May 21, 2010

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References (40)

Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
1558-7894
DOI
10.1108/jabs.2010.4.2.100
Publisher site
See Article on Publisher Site

Abstract

This paper investigates whether the investment strategies of multinational enterprises MNEs have changed as a result of the 1997 financial crisis in Korea. Estimation results using balanced panel data indicate that the investment decisions of global MNEs seem to have changed following the crisis. The crisis seems to have served as a cold shower for MNEs making investment decisions, as they have taken exchange rate volatility into account to a greater extent following the crisis. In contrast, there is no robust evidence that the investment decisions of foreign investors are closely correlated with the level of exchange rate, either before or after the crisis.

Journal

Journal of Asia Business StudiesEmerald Publishing

Published: May 21, 2010

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