Maurice Kugler

Maurice Kugler is a Colombian American economist born in 1967. He received his Ph.D. in Economics from UC Berkeley in 2000, as well as a M.Sc.(Econ) and a B.Sc. (Econ) both from the London School of Economics. Kugler is currently Principal Research Scientist and Managing Director at IMPAQ International. Before that, he was Head of the Development Research and Data Unit at the Human Development Report Office of UNDP. He was named in 2007 to the inaugural CIGI Chair in International Public Policy by the Laurier School of Business and Economics. In 2010, CIGI, the Centre for International Governance Innovation, jointly with University of Waterloo and Wilfrid Laurier University launched the Balsillie School for International Affairs, under the sponsorship of the entrepreneur and philanthropist Jim Balsillie.

Kugler has conducted research on international trade, foreign direct investment and skilled migration. He explores how global market integration impacts on the prospects of economic growth and convergence for the poor in nations and regions. Since 2006, he has been Research Fellow at the Growth Lab of the Center for International Development in Harvard University, and since 2007, visiting scholar at the National Bureau of Economic Research (NBER). He has taught at Harvard, Los Andes, Southampton and Stanford Universities.

His publications can be found in the Review of Economics and Statistics (MIT Press), the Journal of Policy Reform (Routledge), the Journal of Public Economics (Elsevier), the Journal of Development Economics (Elsevier), Economic Development and Cultural Change, Economics Letters and other prestigious academic journals.

Foreign Direct Investment

In his work on spillovers from foreign direct investment (FDI), Kugler has shown that the presence of multinational corporation affiliates (MNC) can yield technological opportunities for host country producers in upstream sectors, especially when the MNC subsidiary is an exporter and the potential spillover recipient firm has absorptive capacity to adopt new technology. When subsidiaries and local firms are connected through the production chain, then FDI generates transmission of technological knowhow as input suppliers are the recipients of information from their clients.

(See e.g. Maurice Kugler (2006), "Spillovers from foreign direct investment: within or between industries? Journal of Development Economics, Vol. 80, No. 2, pp. 444–477).

Other recent evidence of the impact of FDI on Venezuelan manufacturers shows that when MNC subsidiaries use the host country as an export platform, there tends to be more scope for FDI spillovers, especially within sectors as subsidiaries do not compete for the domestic market with local firms. In particular, the fact that exporter subsidiaries are more prone to transmit information to local firms implies that vertical FDI is more likely to generate spillovers. Since vertical FDI involves the import of components and assembly for exports, the incentive to prevent technology leakages to domestic firms is diminished, as they are not in the competitive fringe.

(See e.g. Blyde, Juan, Kugler, Maurice, Stein, Ernesto (2009) "Exporting or Local Input Use by MNC Subsidiaries: Which Determines FDI Spillovers?, Working Paper, Department of Economics, Wilfrid Laurier University).

A study on the link between labor migration and FDI shows them to be complementary rather than substitutes as standard trade theory would suggest. In a neoclassical model, for the capital-labor ratios to equalize, in the presence of factor mobility, either jobs flow to workers in the form of capital inflows or workers flow to jobs in the form of migration, in countries with relatively low capital-labor ratios. In this context, migration and FDI would be substitutes. However, if migration leads to information flows about investment opportunities in the origin country of workers entering the labor force in their destination country, there can be a dynamic complementarity between migration and subsequent FDI.

(See e.g. Maurice Kugler and Hillel Rapoport (2007), "International labour and capital flows: Substitutes or complements?" Economics Letters, Vol. 92, No. 2, pp. 155–162).

International Migration

Research on the determinants FDI location shows evidence consistent with the incorporation of skilled migrants into business networks at the destination country. The links created by these migrants appear to create opportunities for investors in the destination country for FDI project at the migrants' countries of origin. FDI creates jobs where workers have left because those workers convey information to MNC headquarters.

(See e.g. Souraya El Yaman, Maurice Kugler and Hillel Rapoport (2006), "Migration and Foreign Investments across the European Union: What are the Links?" Revue Economique, Vol. 58, No. 3, pp. 725–733).

Research on the impact of remittances to mitigate brain drain analyzes conditions under which migration can have a positive impact on human capital formation. There is a direct channel as remittance recipients overcome borrowing constraints to invest in schooling. And there is an indirect channel since the greater supply of human capital can generate creation of skilled jobs, through a thick-market externality. The likelihood that new human capital formation, associated with remittances, exceeds brain drain is higher in the context of well-functioning education systems and labor markets.

(See e.g. Kugler, Maurice, and Emanuela Lotti (2007), "Migrant Remittances, Human Capital Formation and Job Creation Externalities in Central America," Integration & Trade Journal 27 (July–December): 105-134).

Exports

Research on export dynamics suggests that experimentation is an important component of the investment to establish presence in a new market, understood as a product and destination combination. Exporters need to receive a profitability signal when they export in different markets in order to know whether market penetration is likely to generate enough sales to cover fixed costs of market entry. Initially they export small quantities and depending on the signal received from customers, they either expand sales or cease to export in the new market. This pattern fits the experience of Colombian exporters.

(See e.g. Jonathan Eaton, Marcela Eslava, Maurice Kugler and James Tybout (2007), "Export Dynamics in Colombia: Firm-Level Evidence," NBER Working Paper No. 13531).

Research on the scope for learning from successful exporters, recent evidence from Argentina points to gains for nonexporters that supply intermediate inputs to exporters. While there widespread evidence that FDI generates learning from multinational subsidiaries, there is limited evidence that exporters, which are exceptional performers, create similar opportunities for spillovers. It appears that subsidiaries of multinational corporations do not generate spillovers unless they are exporters. This suggests that exporting spillovers can be a source of productivity growth.

(See e.g. Facundo Albornoz and Maurice Kugler (2008), "Exporting Spillovers: Firm-Level Evidence from Argentina," Working Paper eg0057, Department of Economics, Wilfrid Laurier University)

In the past, Kugler has held academic positions at the economics departments of Universidad de Los Andes, in Colombia, and University of Southampton, in the United Kingdom. He has been visiting professor at Harvard and Stanford University. Kugler has been awarded research grants by the NSF and the Tinker Foundation in the United States as well as DfID and the ESRC in the United Kingdom. His research has been published widely in top economics academic journals. He has been adviser to the Central Bank and Government of Colombia, as well as consultant for the Inter-American Development Bank and the World Bank.