A Study of ASEAN Free Trade Area and Foreign Direct Investment Effects

• Main Authors: Chia-Chi Nien, 粘家淇
• Other Authors: Chen-Kuo Lee
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/14483587604811459144

碩士 === 嶺東科技大學 === 國際企業系碩士班 === 104 === Concerning the issue of Free Trade Area (FTA), price theory obviously lacks in suitability. Prices are not the only considerations for the reasons for ASEAN region member nations have chosen to form alliances. More importantly, the sharing or conflicts of interest have been the drive for those governments. Game theory research can better reflect the governments’ interest maximization choices. Therefore, the game theory method was adopted in this study to carry out research on the member nations’ signing of FTA investment agreements in regards to two different areas: the game that attracts the nations to invest and the game that attracts regional investment. Research results show that whether mutual investments among the member nations within the region or investment attracted from outside the region, if the countries Optimal for the non-cooperative game, they will pass the preferential policy one after another to achieve interest maximization for their country, thus triggering vicious competition and resulting in compromised national welfare. Hence, the signing of the free investment agreement and improving the investment environment through cooperative games are necessary choices. Through the establishment of the FTA, the ASEAN countries’ sound investment and trade cooperation relations, market capacity expansion, strengthened policy transparency, improved government credibility, and overall investment cycle within the region and the entry of investment outside the region can be improved. This enables the member nations to share region-wide FDI interests and improving the overall welfare of the nations.