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The Economic Research Institute, Stockholm School of Economics SSE/EFI Working Paper Series in Economics and Finance

No 216:
Productivity Growth in Indonesia: The Role of Regional Characteristics and Direct Foreign Investment

Fredrik Sjöholm ()

Abstract: Using detailed micro data from the Indonesian manufacturing sector, we examine the effect on productivity growth of different regional characteristics and direct foreign investment. The results suggest that a diversified regional industry sector increase productivity growth. Direct foreign investment benefits establishments in neighbouring industries within the region. There are intra-industry spillovers from direct foreign investment at a national level, but there does not seem to be a geographic component in this type of spillovers.

Keywords: Indonesia; regional development; direct foreign investment; spillovers; productivity; (follow links to similar papers)

JEL-Codes: F23; O12; R11; (follow links to similar papers)

42 pages, January 14, 1998

Revised version forhtcoming in Economic Development and Cultural Change (jan, 1999).

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This paper is forthcoming as:
Sjöholm, Fredrik, 'Productivity Growth in Indonesia: The Role of Regional Characteristics and Direct Foreign Investment', Economic Development and Cultural Change.



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