Investors’ characteristics and the business climate as drivers of backward linkages in Vietnam

Chiara Franco, Marco Sanfilippo, Adnan Seric
2019
DOI number
http://dx.doi.org/10.1016/j.jpolmod.2018.09.002
#Trade and FDI
#South Asia

This paper analyses the factors determining the establishment of backward linkages and their key features once established. To carry out our analysis, we exploit an original survey conducted in 2011 on roughly 1500 investors based in Vietnam. We show that some characteristics of the investor firm, including size, productivity, experience and autonomy in decision-making, affect the capacity of linkages to create a larger network of local suppliers. In addition, we show that it is the provision of a good investment climate, and more importantly of key business support services, that mainly influences the capacity of investors to trigger knowledge and other key resources’ transfer to their local suppliers.

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