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Books > Business & Economics > Economics > Labour economics
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Foreign Direct Investment in Developing Countries - A Theoretical Evaluation (Hardcover, 2014 ed.)
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Foreign Direct Investment in Developing Countries - A Theoretical Evaluation (Hardcover, 2014 ed.)
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In development literature Foreign Direct Investment (FDI) is
traditionally considered to be instrumental for the economic growth
of all countries, particularly the developing ones. It acts as a
panacea for breaking out of the vicious circle of low savings/low
income and facilitates the import of capital goods and advanced
technical knowhow. This book delves into the complex interaction of
FDI with diverse factors. While FDI affects the efficiency of
domestic producers through technological diffusion and spill-over
effects, it also impinges on the labor market, affecting
unemployment levels, human capital formation, wages (and wage
inequality) and poverty; furthermore, it has important implications
for socio-economic issues such as child labor, agricultural
disputes over Special Economic Zones (SEZ) and environmental
pollution. The empirical evidence with regard to most of the
effects of FDI is highly mixed and reflects the fact that there are
a number of mechanisms involved that interact with each other to
produce opposing results. The book highlights the theoretical
underpinnings behind the inherent contradictions and shows that the
final outcome depends on a number of country-specific factors such
as the nature of non-traded goods, factor endowments, technological
and institutional factors. Thus, though not exhaustive, the book
integrates FDI within most of the existing economic systems in
order to define its much-debated role in developing economies. A
theoretical analysis of the different facets of FDI as proposed in
the book is thus indispensable, especially for the formulation of
appropriate policies for foreign capital.
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