Volume 28 Number 1, 2023

The Spillover Effect of FDI on Domestic Firms: The Case of Vietnam

Do Ta Khanh^a, Dang Thai Binh^b* 
Vietnam Academy of Social Sciences, Vietnam
^a dotakhanh@gmail.com
^b* dangthaibinh1985@gmail.com 

ABSTRACT

The paper examines the impact of spillover effects of FDI on the performance and wage level of Vietnamese firms. By making use of the panel data from 2007 to 2018 at the firm level, the paper finds the following results. FDI labour-turnover has the biggest impact on the manufacturing sector. In the manufacturing sector, FDI labour-turnover has the biggest impact on the manufacture of computers, electronics and optical, the manufacture of motor vehicles, the manufacture of leather, and the manufacture of electrical equipment. FDI labour-turnover has a positive impact on the performance of domestic firms in which the large firm enjoy the most benefits from FDI. FDI labourturnover and FDI backward linkage have positive impacts on the wage level of domestic firms. 

JEL Classification: F2, L6, O1 

Keywords: FDI, economic transformation, emerging economy, spillover effect, employment 

Cite this article: 

Khanh, D.T., and Binh, D.T., 2023, The Spillover Effect of FDI on Domestic Firms: The Case of Vietnam, International Journal of Business, 28(1), 002. https://doi.org/10.55802/IJB.028(1).002