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Linkage between Exchange Rate and Foreign Direct Investments: Empirical evidence from Developing Countries
Hnath, Martin ; Geršl, Adam (advisor) ; Benáček, Vladimír (referee)
In this thesis we provide an updated empirical evidence on the linkage between an exchange rate and foreign direct investments (FDI). On the sample of 40 developing countries receiving FDI flows from five developed OECD econo- mies, we analyse how the strength of exchange rates, exchange rate volatility and currency regime affect FDI. Applying the Hausman-Taylor instrumental variable approach over the analysed period from 1991 to 2010, we have not found unanimous support on the role of exchange rates in influencing FDI. In the thesis, we document that over the last two decades, bilateral exchange rate volatility decreased and this can be assigned to its less-likely influence on FDI. In addition, based on the results of the analysis, we cannot confirm the wealth effect hypothesis that supposes an increase of FDI after real depreciation of developing country's currency. We ascribe this outcome to the development of average real exchange rates of developing countries that exhibited considerable strenghtening during the analysed period. We also find that de facto bilateral fixing of the currencies might be beneficial for FDI flows. The reasoning might lie in the reduction of transaction costs that is linked to credible exchange rates.
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The Developement of Economic Cooperation between EU and USA since the end of the Cold War
Paščenková, Jana ; Kučerová, Irah (advisor) ; Karlas, Jan (referee)
in English This thesis deals with the factors that influence changing intensity of bilateral economic cooperation between EU and USA in the period between 2002 and 2012. The quantitative tests by correlation are made separately for the trade and the financial area of cooperation. The first tested factor was the economic interdependence of EU and USA, which is based on liberal thoughts in international relations. Its positive influence on cooperation that was assumed for this factor was confirmed only in case of the financial area. On the other hand, for the trade sphere the premise was disproved. The second tested factor was formulated based on realism in international relations. It says that decreasing economic standing of EU and USA leads to their increased cooperation. This influence was confirmed both for trade and financial cooperation. The last researched factor was the annual change in the volume of transactions. This factor is based on functionalism, neofunctionalism and communication theory. The assumed positive influence of increased transactions on cooperation was confirmed only in trade dimension. The best factor that can explain the changing bilateral economic cooperation of EU and USA between 2002 and 2012 proved to be the one based on realism - the declining standing of both subjects...
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Corporate tax rates: A new area of international cooperation?
Hrušč, Erik ; Parízek, Michal (advisor) ; Kučerová, Irah (referee)
This thesis analyses the potential for international cooperation in the issue of corporate tax rates. Using newly created dataset we study the relationship between the foreign direct investments and corporate tax rates in order to confirm that countries benefit from competing in setting their tax rates. Lowering one's corporate tax rate pays off in increased FDI. Furthermore, under the assumption that competitive behavior is individually rational, we analyze through the use of coherent country clusters the extent of competition within selected clusters, as compared to the situation on the global level. We find that the degree of competitive behavior is lower within coherent block of countries than globally. Thus, there seems to be less mutually harmful competition within coherent clusters of countries, mainly in EU 15, OECD and ASEAN, than on the global level.
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FDI drop in Slovakia during the economic crisis (2008-2010)
Stoila, Martin ; Kučerová, Irah (advisor) ; Knutelská, Viera (referee)
The thesis discusses the causes of the sudden FDI drop in Slovakia during the economic crisis when R. Fico's government was in power. The drop came after Euro adoption, deep structural reforms and overall attractiveness of the country for the foreign investors. Mainly qualitative methods are utilized in the paper - coding was found to be the most appropriate method to analyze the reasons companies stated for leaving the country. Almost 64% of the investors mentioned crisis as the main cause of their departure. It was followed by company's strategy, the government's policies, strong currency and old machinery and technologies used in the factory. Thus, the hypothesis, which stated that the main reason for FDI plunge were policies of then government in combination with effects of economic crisis, was not confirmed.
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Brazil as a destination for foreign direct investments
Brožová, Markéta ; De Castro, Tereza (advisor) ; Fialová, Barbora (referee)
The objective of this thesis is to elaborate conditions for foreign direct investments to be directed in Brazil and to find out how is the country attractive to investors and what are it´s drawbacks. The first theoretical chapter defines foreign direct investments and identifies factors that are determinant in the phase of decision-making whether to make or not a foreign direct investment in a considered economy. The second chapter follows with the specification of Brazil´s economy and its macroeconomic development in the course of 21st century. This provides a framework for elaboration of economic conditions for foreign direct investments in Brazil. The chapter also examines sectors in attempt to identify their competitiveness. The third chapter focuses on current situation of this country in terms of attractiveness of Brazil for foreign direct investments. Analysis of the situation is made according to the factors identified in the first chapter.
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Fiscal effectiveness of Investment Incentives in Czech Republic
Pechová, Kateřina ; Kubátová, Květa (advisor) ; Morávková, Jana (referee)
My diploma thesis is focused on the issue of investment incentives in the Czech Republic. The first part includes a study of the literature, especially on the issues of foreign direct investments and related investment incentives. The next part is dedicated to influence of foreign direct investments on macroeconomic indicators and also to the evolution of investment incentives in the Czech Republic. The main part of the thesis studies the fiscal effectiveness of the investment incentives by the chosen multinational companies operating in the Czech Republic, especially from the income and expense side of the state budget. In particular, incomes and expenses by the chosen companies during a five year period after first drawing of investment incentives are compared.
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Investment environment of Bavaria
Klimková, Veronika ; Jiránková, Martina (advisor) ; Famfule, Jan (referee)
Bavaria, one of the wealthiest states in Germany, represents a globally active market, where not only many international companies operate but there is also a strong base of small and medium-sized enterprises in the area of trade, industry and service sector. The local government supports the further economic growth of the state through the implementation of investment policy which annually attracts many investors here. The aim of this work is to evaluate the potential and attractiveness of Bavaria from the perspective of investors as well as to analyse investment flows flowing into the state in comparison with the entire Federal Republic of Germany.
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Hong Kong as a trading partner of European Union and the Czech Republic
Maťušová, Jana ; Antal, Jarolím (advisor) ; De Castro, Tereza (referee)
The diploma thesis analyzes the business partnership between Hong Kong and European Union, with a particular focus on the importance of business activities between the Czech Republic and Hong Kong through statistical analysis of exports, imports and foreign direct investments. The thesis includes a questionnaire survey of Czech entrepreneurs trading with Hong Kong to assess the advantages and disadvantages of Hong Kong as a trading partner of European Union and the Czech Republic, the role of Hong Kong and European institutions and organizations supporting mutual development of business activities and highlight the opportunities for development of mutual not only trade relations to the future.
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Economic diplomacy in the new millenium and implications for the Czech Republic
Krčál, Adam ; Zamykalová, Miroslava (advisor) ; Veselý, Zdeněk (referee) ; Štouračová, Judita (referee)
The dissertation thesis focused on a topical issue of the economic diplomacy, its role in the current economic discourse and its implication for the Czech Republic. The main contribution of the thesis can be seen in linking traditional economic issues, such as external economic relations balance with political issues, for example the governance of economic diplomacy on the national level. Being placed between economics and politics is a typical feature for the economic diplomacy. The thesis analysed various aspects of economic diplomacy, predominantly the export promotion and foreign direct investments. The Czech economic diplomacy has a big potential for further development. The Czech entrepreneurs are quite successful on foreign markets, both in the developed countries and in the third World. If the identified weaknesses were eliminated and some improvement measures were adopted, the positive impact on the economy and the business environment will arrive soon. The economic diplomacy plays an important role in the open economy, which is also the case of the Czech Republic. It also hugely affects the external economic balance of the country. The thesis also showed that the governance of the Czech economic diplomacy suffers from major deficiencies, particularly in terms of the distribution of powers and responsibilities. This hinders an efficient functioning of the state system of export promotion. In addition, the state support is not targeted enough at the sector of SMEs that needs the most support. The level of awareness about the public services provided is low. On the other hand, the findings showed that another important element of the economic diplomacy, the state support of foreign direct investments is very instrumental in the competitiveness of the economy and thus substantively contributes to the economic growth. The comparative analysis of the governance systems in Germany, Austria, Finland and France revealed that although the Czech system of economic diplomacy governance is similar to a certain extent to the analysed countries, there are still some issues to deal with that negatively affects the efficiency. There are a number of suggestions for further improvement provided in the thesis that can be used by the policy makers.
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