Front Matter Page
Statistics Department
Front Matter Page
What Is Real and What Is Not in the Global FDI Network?*
Jannick Damgaard (Danmarks Nationalbank)
Thomas Elkjaer (International Monetary Fund)
Niels Johannesen (University of Copenhagen and CEBI)
December 2, 2019
Contents
1 Introduction
2 Estimating the global FDI network
2.1 Data sources
2.2 Total FDI by economy of immediate investor
2.3 Decomposition: Real vs Phantom investment
2.4 Real FDI by economy of ultimate investor
2.5 Summary statistics
3 Characteristics of the global FDI network
3.1 The nature of global FDI
3.2 Phantom FDI, Real FDI and round-tripping by economy
3.3 Real bilateral investment links
3.4 Exposure to tax avoidance opportunities
4 Conclusion
Figures
Figure 1 – Largest inward FDI positions in 2017
Figure 2 – Prediction model and predictions
Figure 3 – Model sensitivity
Figure 4 – Sensitivity of predictions
Figure 5 – Validation of Orbis approach
Figure 6 – Global Real and Phantom FDI
igure 7 – Phantom FDI
Figure 8 – Real FDI and ultimate ownership
Figure 9 – Round-tripping and Real FDI links
Figure 10 – Exposure to tax avoidance opportunities
Tables
Table 1: Data sources and coverage (2016, FDI in $billions)
Table 2: Prediction model
Table 3: Summary statistics (2017)
Table 4: Gravity models
Table 5: Exposure to tax avoidance opportunities
References
Online Appendix
We are grateful for constructive comments from colleagues at Danmarks Nationalbank and the IMF as well as Juan-Carlos Suarez Serrato and other participants at the Academic Symposium on Business Taxation at Oxford University. We are also grateful for detailed feedback from the authorities of Belgium, Hong Kong SAR, Indonesia, Ireland, Luxembourg, Singapore, Switzerland and the United Stated. Niels Johannesen acknowledges support from the Danish National Research Foundation. The FDI data estimated in this paper, as well as code documenting the estimation from publicly available data sources, are available at https://nielsjohannesen. net/FDIdatabase/.