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How does foreign direct investment affect economic growth

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TLDR
In this article, the effect of FDI on economic growth in a cross-country regression framework was investigated. And they found that FDI contributes to economic growth only when a sufficient absorptive capability of the advanced technologies is available in the host economy.
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This article is published in Journal of International Economics.The article was published on 1998-06-01 and is currently open access. It has received 4268 citations till now. The article focuses on the topics: Foreign direct investment & Productivity.

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FDI from the south: The role of institutional distance and natural resources

TL;DR: In this paper, the authors analyze location choices of investors from emerging economies, with an emphasis on institutions and natural resources, and find that FDI from the South has a more regional aspect than investment from the North.
Journal ArticleDOI

Emerging multinationals: outward FDI from the BRICS countries

TL;DR: In this article, the authors take stock of the mounting outward investment flows with special focus on China, India, Brazil, Russia, and South Africa ('BRICS'), and suggest that the current increase in outward investment from emerging and developing economies may constitute a third "wave", distinct from the two previous waves depicted in the literature.
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Openness and Growth: Re-Examining Foreign Direct Investment, Trade and Output Linkages in Latin America

TL;DR: This article investigated the effects of liberalization in Mexico, Brazil and Argentina by taking into account trade and FDI growth links, and found that it is important to consider both exports and international capital flows to ascertain the benefits associated to the outward oriented strategies followed by these countries.
Journal ArticleDOI

FDI and productivity convergence in Central and Eastern Europe: an industry-level investigation

TL;DR: In this paper, the authors present empirical evidence of the effect of FDI inflows on productivity convergence in Central and Eastern Europe, using a new and harmonized industry-level data set.
Report SeriesDOI

Characteristics of foreign-owned firms in British manufacturing

TL;DR: The authors found that establishments that are alwaysforeign-owned have significantly higher labour productivity than those that remain under domestic ownership, and that labour productivity improves faster over time and faster with age in foreign-owned establishments.
References
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ReportDOI

Endogenous Technological Change

TL;DR: In this paper, the authors show that the stock of human capital determines the rate of growth, that too little human capital is devoted to research in equilibrium, that integration into world markets will increase growth rates, and that having a large population is not sufficient to generate growth.
Journal ArticleDOI

Finance and Growth: Schumpeter Might Be Right

TL;DR: In this paper, the authors examined a cross-section of about 80 countries for the period 1960-89 and found that various measures of financial development are strongly associated with both current and later rates of economic growth.
Book

Innovation and growth in the global economy

TL;DR: Grossman and Helpman as discussed by the authors developed a unique approach in which innovation is viewed as a deliberate outgrowth of investments in industrial research by forward-looking, profit-seeking agents.
Posted Content

A sensitivity analysis of cross-country growth regressions

TL;DR: The authors examined whether the conclusions from existing studies are robust or fragile to small changes in the conditioning information set and found a positive, robust correlation between growth and the share of investment in GDP and between investment share and the ratio of international trade to GDP.
Journal ArticleDOI

Institutions and economic performance: cross‐country tests using alternative institutional measures

TL;DR: The authors compared more direct measures of the institutional environment with both the instability proxies used by Barro (1991) and the Gastil indices, by comparing their effects both on growth and private investment.
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How does foreign direct investment affect economic growth?

FDI is an important vehicle for technology transfer and contributes more to economic growth than domestic investment, but only when the host country has a minimum threshold stock of human capital.

How does foreign direct investment affect economic growth?

Foreign direct investment (FDI) contributes to economic growth by transferring technology, but only when the host country has a minimum stock of human capital.