Sebnem Kalemli-Ozcan

TL;DR: In this article, the authors examine the various links among foreign direct investment (FDI), financial markets, and economic growth, and explore whether countries with better financial systems can exploit FDI more efficiently.

TL;DR: This paper examined the empirical role of difierent explanations for the lack of flow of capital from rich to poor countries, including differences in fundamentals across countries and capital market imperfections, and showed that during 1970-2000 low institutional quality is the leading explanation.

TL;DR: In this paper, the authors examine the various links among foreign direct investment (FDI), financial markets, and economic growth and explore whether countries with better financial systems can exploit FDI more efficiently.

TL;DR: In this paper, the authors developed a model of heterogeneous firms facing financial frictions and investment adjustment costs, and showed that the decline in the real interest rate, often attributed to the euro convergence process, leads to a decline in sectoral total factor productivity as capital inflows are misallocated toward firms that have higher net worth but are not necessarily more productive.

TL;DR: In this article, the authors formalize a mechanism that emphasizes the role of local financial markets in enabling FDI to promote growth through backward linkages, and quantify the response of growth to FDI and show that an increase in the share of FDI leads to higher additional growth in financially developed economies relative to financially under-developed ones.