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</td><td colspan="4"><p>A. FDI Distribution (%) </p></td><td colspan="4"><p>B. Per Capita FDI (US$) </p></td></tr><tr><td colspan="2"><p>1980s </p></td><td colspan="2"><p>1990s </p></td><td colspan="2"><p>1980s </p></td><td colspan="2"><p>1990s </p></td></tr><tr><td><p>Early </p></td><td><p>Late </p></td><td><p>Early </p></td><td><p>Late </p></td><td><p>Early </p></td><td><p>Late </p></td><td><p>Early </p></td><td><p>Late </p></td></tr><tr><td><p>AFR </p></td><td><p>6.0 </p></td><td><p>8.8 </p></td><td><p>4.0 </p></td><td><p>3.9 </p></td><td><p>2.7 </p></td><td><p>2.9 </p></td><td><p>4.2 </p></td><td><p>10.6 </p></td></tr><tr><td><p>EAP </p></td><td><p>15.3 </p></td><td><p>40.2 </p></td><td><p>48.7 </p></td><td><p>37.3 </p></td><td><p>1.8 </p></td><td><p>4.0 </p></td><td><p>17.8 </p></td><td><p>34.2 </p></td></tr><tr><td><p>ECA </p></td><td><p>0.1 </p></td><td><p>0.6 </p></td><td><p>8.6 </p></td><td><p>13.2 </p></td><td><p>0.1 </p></td><td><p>0.3 </p></td><td><p>12.6 </p></td><td><p>54.8 </p></td></tr><tr><td><p>LAC </p></td><td><p>35.4 </p></td><td><p>38.2 </p></td><td><p>29.8 </p></td><td><p>39.8 </p></td><td><p>16.9 </p></td><td><p>14.1 </p></td><td><p>38.4 </p></td><td><p>137.5 </p></td></tr><tr><td><p>MENA </p></td><td><p>42.5 </p></td><td><p>10.1 </p></td><td><p>7.4 </p></td><td><p>3.5 </p></td><td><p>32.5 </p></td><td><p>5.7 </p></td><td><p>12.7 </p></td><td><p>16.8 </p></td></tr><tr><td><p>SAR </p></td><td><p>0.6 </p></td><td><p>2.1 </p></td><td><p>1.5 </p></td><td><p>2.3 </p></td><td><p>0.1 </p></td><td><p>0.3 </p></td><td><p>0.8 </p></td><td><p>2.9 </p></td></tr></tbody></table> <p>Source: World Bank, Global Development Finance, 2002. </p> <p>4. Such an overall picture changes once again when the sizes of the regions are taken into account. On a per capita basis, the achievements of Latin American and Caribbean countries over-shadow those of all other countries, while the performance of countries in South Asia, though improving, still lags far behind. (Table 2B.) </p> <p>2 </p> <p>1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 </p> <p>2001e </p> <p>5. What these basic facts tell us is that more than any other economic forces, FDI is driving the process of globalization by creating an increasingly tighter global production network. However, there are great discrepancies in the extent to which countries take part in this network. Not only significant gaps exist between developed and developing countries and among the different regions of the developing world, large and increasing disparities prevail even within the same region. (Table 3.) This phenomenon leads us to many questions: What are the roles of FDI in economic development? What determines the size and location of FDI flows? And what the states can do to reap the benefits of FDI while avoiding its negative impacts in this globalized world? </p> <p>Table 3: Standard Deviations in FDI Flows within Each Region (US$ millions) </p> <p>Source: IMF International Financial Statistics, 2002. </p> <p>6. This paper attempts to provide some insight to these questions through a brief review of the existing evidence on FDI. The role of FDI in economic development is the center of the discussion and is analyzed in depth in the next section. Both its positive and negative impacts are examined, as well as the channels through which FDI interacts with local economies. The paper then reviews the vast empirical evidence on the determinants of FDI flows, which provides guidance on the pre-conditions that the states need to create to draw out the positive forces of FDI and to prevent its negative effects from harming their economies. </p> <p>II. The role of FDI in Economic Development </p> <p>7. Economic development is an all-encompassing concept. It centers on economic and social progress, but also entails many different aspects that are not easily quantified, such as political freedom, social justice, and environmental soundness.1Without a doubt, all these matters combine to contribute to an overall high standard of living. However, empirical evidence has amply demonstrated that all these varied elements of economic development correlate with economic growth. That is, as a general rule, countries with faster economic growth have more rapid improvement in health and education outcomes, progressively freer political system, increasingly more equitable distribution of wealth, and enhanced capacity for environmental management. Therefore, while economic growth does not bring about automatically other aspects of social, institutional and </p> <p>1The United Nation Charter of 1944. </p> <table><tbody><tr><td> </td><td><p>1980 </p></td><td><p>1985 </p></td><td><p>1990 </p></td><td><p>1995 </p></td><td><p>2000 </p></td></tr><tr><td><p>AFR </p></td><td><p>304 </p></td><td><p>302 </p></td><td><p>301 </p></td><td><p>366 </p></td><td><p>318 </p></td></tr><tr><td><p>EAP </p></td><td><p>214 </p></td><td><p>392 </p></td><td><p>1,014 </p></td><td><p>7,934 </p></td><td><p>9,010 </p></td></tr><tr><td><p>ECA </p></td><td><p>- </p></td><td><p>- </p></td><td><p>68 </p></td><td><p>1,120 </p></td><td><p>1,960 </p></td></tr><tr><td><p>LAC </p></td><td><p>485 </p></td><td><p>463 </p></td><td><p>555 </p></td><td><p>1,919 </p></td><td><p>6,329 </p></td></tr><tr><td><p>MENA </p></td><td><p>725 </p></td><td><p>258 </p></td><td><p>446 </p></td><td><p>544 </p></td><td><p>661 </p></td></tr><tr><td><p>SAR </p></td><td><p>26 </p></td><td><p>47 </p></td><td><p>95 </p></td><td><p>760 </p></td><td><p>790 </p></td></tr></tbody></table> <p>3 </p> <p>environmental improvements, without economic growth, there is limited prospects for such achievements. </p> <p>8. In this context, the paper examines the role of FDI in economic development as a key ingredient for successful and suXXXXXXXXX XXXXXXXX growth and as XXXX XX a mechanism XX XXXXXX development. This XXXXXXX of XXX XXXXX XXXX XX highlight XXX most important channels XXXXXXX which FDI XXXXX a XXXXXXXXXXX and XXXXXXXXXXXXX XXXXXX on XXX XXXXXXXX development of XXX host XXXXXXXXX. XX the same XXXX, it XX important to recognize XXXX, like XXX XXXXXX, XXX is not XXX XXXX XX bad. X separate XXXXXXXXXX is XXXXXXX XX XXX potential negative impacts of FDI XXXXX XX XXXX economies. </p> <p>A. An Impetus to Economic XXXXXX </p> <p>9. XXX XXXXXXXXX for XXXX XXXXXX growth has expanded drastically over XXXX. Before XXX XXXXXXXXXX XXXXXXXXXX, it XXXX European countries XXXX 350 XXXXX for income per XXXXXX to XXXXXX. XX the industrial XXXXXXXXXX accelerated in the 19thcentury, XXXXXXX, XXX lead country, was able XX XXXXXX XXX XXX XXXXXX XXXXXX in XXXX over XX years. After XXX World War II XXX especially towards the XXX XX the twentieth century, many developing XXXXXXXXX, XXXX XX XXXXX, XXXXXXXX, Chile, Ireland, XXX the XXXX performing East Asian XXXXXXXXX, managed XX XXXXXX XXX XXXXXX XXXXXX in less XXXX 10 XXXXX. (XXXXX X.) XXX the first time in XXXXXXX, it XX XXX possible XXX a poor person from an XXXXX-developed XXXXXXX to XXXX from XXXXXXX to a XXXXXXXXXX XXXXXXXXXXX life within a XXXXXX XXXX span. </p> <p>Table X: XXXX XXXXXX XX XXXXXX XXXXXX </p> <p>XXXXXX: Crafts (XXXX). </p> <p>10. Just what is it that XXXXX such rapid XXXXXXXX possible? Economic studies offer many potential XXXXXXXXXXXX. According to one recent growth theory, XXXX XXXX XXXXXXXX growth can XX XXXXXXXXX as the combination of XXXXXX in XXX XXXXXXX, i.e. XXX XXXXXXXXX in XXXXXX inputs (capital XXX XXXXX ) and in total XXXXXX XXXXXXXXXXXX (TFP), which reflects technological XXXXXXXX XXX XXXXX XXXXXXXXXX improvements in resource XXXXXXXXXXX.2In this “endogenous” XXXXXX framework, FDI XXX XXXXX its XXXXXXX XX contribute significantly to XXX three XXXXXXXXXX of XXXXXX: XXX increases capital XXXXX, boosts XXXXX capital XXXXXXXXXXXX (XXXXXX XXXXXXX unmeasured in labor XXXXX), XXX speeds XX XXXXXXXXXXXXX XXXXXXXX in host countries. Nevertheless, the XXXX XXXXXX impacts XX FDI XX host XXXXXXXXX XXX through its XXXX in XXX XXXXXXXXXXXX of XXXXXXXXXX </p> <p>2More details on growth accounting XXXXXX XXX be XXXXX in XXXXXXXX, A. (1987), “Growth and slowdown in advanced XXXXXXXXXX XXXXXXXXX: techniques of quantitative XXXXXXXXXX,”Journal XX Economic Literature, XXX. 25; XXX XXXXX, X.X. (1998) “Notes on growth XXXXXXXXXX,” NBER XXXXXXX XXXXX No. 6654. </p> <table><tbody><tr><td><p>Pre-Industrial Revolution </p></td><td><p>350 years </p></td></tr><tr><td><p>Britain, 1st Industrial XXXXXXXXXX </p></td><td><p>175 years </p></td></tr><tr><td><p>XXXXXXX, XXX XXXXXXXXXXX </p></td><td><p>65 XXXXX </p></td></tr><tr><td><p>XXXX developers, XXXX XXXXX War II </p></td><td><p>XX years or less </p></td></tr></tbody></table> <p>4 </p> <p>capital XXX the XXXXXX XX XXX XX the XXXXXXXXXX. XXXXX two XXXXXXX are discussed XXXXXXXXXX below. </p> <p>X. FDI XXX XXXXXXX XXXXXXXXX </p> <p>11. XXXX the XXXXXX Age investment XXXX after XXXXX XXX II XX XXX XXXX XXXXX economic XXXXXXXX in the XXXXX, XXXXX is ample XXXXXXXX to XXXXXXXXXXX that investment is a key XXXXXXXXXX to XXXXXXXXX XXXXXX. Over the XXXX XXX decades in particular, FDI has come XX XXXX a XXXXXXX role in most developing countries’ XXXXX investment. (XXXXXX 3.) However, striking XX XXX rise in XXX importance of XXX may seem in XXXX XXXXXXXXX’ resource XXXXX, FDI XX XXXX part XX the total financing by foreign investors in XXXX XXXXXXXXX. At the same time XXXX XXXXXXX companies mobilize XXXXXXXXX XXXXXX their own corporate systems, XXXXX affiliates XXX also raise funds XXXXXXX XXXXX, loans, XXX equity issuances. To the XXXXXX XXXX these sources are in XXX XXXXXXXXXXXXX capital markets, they XXXXXXXX XXX XXXXX inflows XX XXXXXXX XXXXXXXXX resources XXX development. Indeed, as XXXX XXX XXXXXX XXXXXX transnational XXXXXXXXXXXX suggest, XXX XXXXX XX XXXXXXXX resources to XXXX countries due XX XXX presence XX foreign enterprises often XXXXXX FDI XXXXX alone.X </p> <p>XXXXXX X: XXXXX of FDI to XXXXX XXXXX Capital XXXXXXXXX (%) </p> <p>XX XX 14 12 XX </p> <p>8 6 4 X 0 </p> <p>AFR XXX </p> <p>XXX LAC XXXX SAR </p> <p>XXXXX XXXXX Late 1980s Early XXXXX Late 1990s </p> <p>XXXXXX : XXXXX XXXX, XXXXX XXXXXXXXXXX Report, 2002. </p> <p>12. XXXXXXXXX, XXXXXXX XXXXXXXXXXXXX XXXXXXXXXXXX typically XXXX XXXXXX XX a wide XXXXXXX XX financing options, the risk-XXXXXXXX XXXX of capital XX usually XXXXX for XXXX than the XXXXXXXX XXXXX XXXX developing countries. XXXX XXXXXXXXX XXXXXXX them XX be more XXXXXXXXXX XXXX other XXXXX to XXXXXXXXXX opportunities XXX XXXXXXXXXX. </p> <p>3UNCTAD, World Investment XXXXXX, 1999. </p> <p>5 </p> <p>XXXXXXXXXXXX, they can XXXXXXXXX projects for which domestic XXXXXXXXX XX XXX XXXX the capacities XX XXXXXX or XXXXX XXX considered too risky for XXXX country firms. XX XXXX, XXXX enlarge XXX XXXXXXXXXX XXXXXXXXX in host countries. With XXXX, XXXXXXXXXX conducive XX domestic XXXXXXXXX may be established in XXXXXXXXXX that are beyond XXXXX current XXXXX. XX XXXX XXXXX, XXX XXXX serves to XXXXXXXXX XXXXXXXX investment, whereby XXXXXX XXX total host country XXXXXXXXXX XXXXXXX. XXXXXXXXX studies lend support XX such “XXXXXXXX in” effects of XXX. In XXXXXXXXXXX XX al (XXXX), XXX XXXXXXX, it was estimated that XXX total XXXXXXXX in investment XXX XXXXXXX 1.5 and 2.3 times the XXXXXXXX in the flows XX FDI.X </p> <p>XX. XXXX XXXXXXXXXXX, FDI XXX only XXXX to external financial resources XXX host XXXXXXX XXXXXXXXXXX, it XX also more stable XXXX XXXXX XXXXX XX financing. Typically, XXX XX XXXXX XX a XXXX-term XXXX of the market, XXX XXXXXX potential XXX the structural characteristics XX the recipient XXXXXXXXX. XX XX XXXX less XXXXX XX XXXXXXXXX in XXXXXXX situations XXXX XXXX lending or portfolio XXXXX. XXXX XXXXXXX of XXX is XXXXXXX evident from XXXXXX 4, XXXXX compares the XXXXXXXXXXX XX variations (XXX XXXXXX the XXXXX, XXX XXXX XXXXXXXX XXX resource XXXXX) XX FDI XXXX that of XXXXXXXXX XXXXXXXXXXX XXX XXXXX XXXXX XX private financial flows (XXXXXX XXXX) to developing XXXXXXXXX between XXXX- 2000. </p> <p>Figure 4: Volatility of XXXXXXX Flows in XXXXXXXXXX Countries </p> <p>7.X X.X X.0 4.X X.0 2.0 1.0 X.0 </p> <p>XXXXX 1990s XXXXX XXX XXX XXX </p> <p>XXXXX XXXXX </p> <p>XXXXX XXXXX XXX XXXX SAR </p> <p>1990s 1980s </p> <p>XXXXX </p> <p>1980s 1990s </p> <p>FDI XXXXXXXXX XXXXX </p> <p>Source: XXXXX XXXX, Global Development XXXXXXX, XXXX. </p> <p>14. XXXXXXX, FDI is a much XXXX XXXXXX XXXX of XXXXXXXX financing XXXX all XXXXX types XX XXXXXXXXX XXXXX. XXX of XXX 136 countries XXX XXXXX data XXX available, only 27 countries experienced more XXXXXXXXXX in XXXXX FDI inflows XXXX other XXXXX of external </p> <p>4Borensztein, E. and J. X. Lee (1995), “How does foreign direct XXXXXXXXXX XXXXXX XXXXXXXX growth?” XXXX XXXXXXX Paper No. 5057. </p> <p>6 </p> <p>XXXXXXX financing XXXXXX the 1980s, and this XXXXXX XXX reduced to XX in XXX more turbulent 1990s. XXXX XXXXXX data further XXXXXXX XXX XXXXXXXXXX XX FDI flows: Brazil continues to absorb large XXXXXXX XX FDI in XXX first half of XXXX year – it XX the number X XXXXXXXXX of FDI among XXX XXXXXXXXXX countries (XXXXX China) - XXXXXXX the XXXXXXX downturn in XXXX country. </p> <p>15. XXXXXXX, XXXX XXXXXX FDI may have a XXXX-XXXXXXXX component, it is essentially XXXXXX investment.XXXXXXXX XXX repatriated XXXX XXXX a XXXXXXX yields XXXXXX and part XX XXX profits is routinely XXXXXXXXXX in XXX XXXX country. XX such, XXXX of the risks XXX born XX the XXXXXXXXXXXX XX the XXXXXXX XXXXXXXXX. XXXX has marked advantage XXXX bank lending, which XXXX XX XXXXXX with fixed interest XXXXXXXXXX XX XXX performance of the project XXX which XXX loan XXX XXXX. Moreover, XXXXXXXXX often XXXX XXXXXXX XXXXXXXXX XX hold XXXX XXXXXXXX when XXXXXXXX fail. This is especially XXXX in XXXXX of XXXXXXXX financial XXXXXX, XXXX government bail-XXXX XXX XXXXXXXXX sought XXX obtained by XXX banks, adding to the XXX XXXXXXX XX XXXX country XXXXXXXXX. Therefore, XXX will XX XXXXXXXXXX not lead XX a XXXX crisis XXX debt XXXXXX will XXXXX be an XXXXX. </p> <p>2. XXX and Productivity XXXXXX </p> <p>16. In traditional XXXXXXXX thinking, XXXXXXXXXXXX XXXXXX XXXXXXXX XXX contribution of XXXXXXXXX technological XXXXXXX XX economic growth. However, new understandings XX XXX growth XXXXXXX, XXXXXXXXXX XXXX the XXXXXX XX XXX endogenous growth theory, XXXX XXX XXXXXXX in such an XXXXXXXXXXXXXX. Depending XX XXX XXXXXX of the XXXXXXXXXX (labor or XXXXXXX XXXXXX), the structure of XXX XXXXXXX, XXX XXX XXXX of XXXXXXXXXXXX between XXXXXXX of XXXXXXXXXX, XXXXXXXXXXXXX XXXXXX XXX be XXXXXX XXXX or less than XXX growth. At XXX XXXX XXXX, XXX XXXXXXXXXX XX the “XXXX” side of XXXXXXXXXXXXX advance – organizational XXXXXXXXX, managerial XXXXXXXXX, tacit knowledge, etc. – is increasingly recognized as an integral XXXX of the XXXXX XXXXXXXXXXXXX upgrade XXXXXXX, contributing to XXX overall productivity growth. </p> <p>17. XXXXXXXX XXX precise level of XXXXXXXXXXXX XX XXXXXXXX XXXXXX, the importance of technological XXX XXXXXXXXXXXXXX advance has long been XXXXXX XXXXXXXXXXX. XX the long pre-XXXXXXXXXX XXXXXXXXXX XXXXXX, a long XXXX XXXXXX rate of 0.X XXXXXXX per XXXX XXX considered remarkable. XXX technological XXXXXXXXXXXX in late XXXXXXXXXXX XXXXXXX doubled the XXXXXX XXXXXXXXX, but it was still lackluster XXXXXXXX XX XXX X percent XXXXXX XXXXXX seen in the high XXXXXXXXXX East Asian economies in XXXXXX XXXXXXX. Just XXXX XXX XXXX XXXXXX in postwar Europe, such rapid XXXXXXXX XXXXXX XX the developing countries in the second XXXX of the XXXXXXXXXXX owed much to the XXXXXXXXX in XXXXXXXX to XXX XXXXXXXXX XX technical XXX XXXXXXXXXXXXXX XXXXXXXXXXX from the XXXXX’s leading countries. XXXXXX, XXXXXX than re-XXXXXXXXX XXXX had already existed elsewhere, XXXXX XXXXXXXXXX countries XXXX were able XX import XXX imitate XXX best practice from more advanced XXXXXXXXX enjoyed unprecedented XXXXXXXX growth. For XXXXXXXXXX world at XXXXX, XXX </p> <p>XXXX debt-XXXXXXXX component XX FDI XXXXXXXX for XXXX than 18 XXXXXXX of the XXXXXXX of FDI to XXXXXXXXXX countries XXXXXXX XXXX-XXXX. XXXXXX, XXXXX XXXXXXXXXX Report, XXXX. </p> <p>7 </p> <p>XXXXX XXX efficient transfer and XXXXXXXX of “XXXX practice” XXXXXX borders becomes XXX XXXX essence of XXXXXXXX XXXXXXXXXXX. </p> <p>XX. Best practice may XX transmitted XXXXXX borders XX various XXXXXXXXXX. Foreign XXXXXX of XXXXXXX XXX provide XXX demand for upgrading, XX well as XXXX level of XXXXXXXXX assistance XX domestic XXXXX. XXXXXXXX capital XXXXX XXX XXXXXX XXXXXXXX technology. XXXXXXXXXX licensing allows countries XX XXXXXXX XXXXXXXXXXX. Expatriates transmit knowledge. XXX, arguably the XXXX XXXXXXXXX means of XXXXXXXXXXXX best practice is XXX as foreign investment tends to XXXXXXX XXX integrate elements XXXX all XX the XXXXX XXXXXXXXXX.6In fact, the XXXX important XXXXXXX XX XXX XX XXXX it XXXXXXXX, XXXXX with XXXXXXXXX XXXXXXXXX, access to XXX whole XXXXX of XXXXXXXXXXXXX, organizational XXX skill assets, XX XXXX as the XXXXXXX of the parent company. XXXX few exceptions, XXX vast XXXXXXXX XX XXX fast-XXXXXXX XXXXXXXXX relied XXXXXXX on FDI XX XXXX XXXXX XXX XXXXXXX their XXXXX economic XXXXXXXXXXXXXX.7 </p> <p>19. FDI transmits best XXXXXXXX in XXX XXXX: internal XXXXXXXXX of technology and XXXXXX to the foreign affiliates in the XXXX country, XXX technological XXXXXXXXX to a broad section of XXXXXXXXX and institutions within the XXXX XXXXXXX. Although the internal XXXXXXXXX of XXXX practice XXXXXXX XXXXXXXXXXX the affiliates, XX the XXXXXX that foreign-owned XXXXX XXXXXXXXXX XXXXXXXX XXXXXXXXXXXX, their XXXXXXXX XXXXX constitutes a XXXXXXXX asset to the XXXX country.8First of XXX, many XX XXX technologies are based XX XXXXXXXXX X&D XXXXXXXX to branded XXXXXXXX that firms generally will XXX sell XX unrelated parties. XXXXXX XXXXXXXXXXX are XXXX the only mechanism XXX the host XXXXXXX XX XXXXXX the XXXXXX XXXXXXXXXXXX and XXXXXX XXX XXXXXXXXXX XXXX. Secondly, XXXXXXX XXXXXXX XXXXXXXXXX XXX generally at XXX forefront to introduce new management XXX organizational techniques, quality control standards, XXX XXXXXXXXX XXXXXXX, they XXXX XX absorb XXXX XXXXXXXX more quickly than local XXXXX. XXXXXX to XXXXX XXXXX XXXXXXXX failures, the affiliates may XXXXX as a XXXX ground XX XXXXX XXX XXXXXXXXXX in the host XXXXXXX. XXXXXXX, XXX many XXXXXXXXXX countries, being incorporated into a global company’s XXXXXXXXXXXXX production network is XXX XXXXXXX XXX for XXXX to XXXX access XX regional or XXXXXX markets. </p> <p>XX. XXXXXXXXXXXX, the XXXXXXXX impact XX XXX XX domestic economic growth XXXXXXX XX XXX XXXXXXXXX of XXXX XXXXXXXX through XXX local economy XX large. This XXXXXXXXX XXXXXXX XXXXX place through four XXXX XXXXXXXX: XXXXXXXX linkages XXXX XXXXX XXXXXXXXX (XXXXXXXX), XXXXXXX XXXXXXXX with local XXXXXXXXX XXX distributors, XXXXXXXXXX linkages </p> <p>6Klein, X., X. Aaron, and B. Hadjimichael (2001), “XXXXXXX XXXXXX XXXXXXXXXX XXX XXXXXXX XXXXXXXXX,” Policy Research XXXXXXX XXXXX No. XXXX, The World XXXX. 7Japan and Korea XXX essentially the only examples XX XXXXXXXXX XXXXX XXXXXXXX rapid XXXXXX XXXX minimal reliance on XXX. This strategy is very XXXXXXXXX to XXXXXXXXX, XXXXXXXXXX in XXXXXXXXX without a solid skill XXXX, a XXXXXXX XXXXXXXXXXXXXXX XXXXXX, a capable XXXXXXXXXXX, and conducive incentive XXXXXXX. </p> <p>8Many studies show that foreign ownership XXXXXXXXXX correlates XXXX productivity increases of XXX firm. XXX Ramachandran, X. XXX M. K. XXXX (XXXX), “XXX XXXXXXX of XXXXXXX ownership in XXXXXX: XXXXXXXX XXXX XXXXX, XXXXX XXX XXXXXXXX,” XXXX XXXXX No. XX, The World XXXX.; Djankov, S. XXX X. XXXXXXX (1998), “XXXXXXX investment XXX productivity XXXXXX in Czech enterprises,” XXXXXX XXXXXXXX Working Paper 2115, XXX World XXXX.; and Aitken, X. XXX A. X. Harrison (XXXX), XX domestic XXXXX XXXXXXX from direct foreign XXXXXXXXXX? XXXXXXXX XXXX Venezuela,”XXX XXXXXXXX Economic XXXXXX, XXX. 89, No. 3. </p> <p>X </p> <p>XXXX XXXXX competitors, XXX XXXXXXXX XXXX XXXXX institutions XXXX as XXXXXXXXXXXX XXX research XXXXXXXXXX as XXXX as vocational training XXXXXXX. XX XXXXXXXXXX countries, XXX most important channel of these is usually XXXXXXXX: XXX XXXXXXXX XX XXXXXX XXX XXXXXXXX from local XXXXXXX of XXXXXXX XXXXXXXXX. </p> <p>21. XXX things (cost, quality, reliability, etc.) XXXXX equal, XXXXX procurement XX generally XXXXXXXXX than XXX’s XXXXXX XXXXXXXXX or in-house production XXXXXXX XXXXXXXXX XXXXXX XXXXXXXXXXX costs XXX XXXXXX for XXXXXXX XXXXXXXXXXX and specialization. This is XXX whenever XXX costs XX XXXXX so are XXXXX than XXX XXXXXXXXX savings, XXXXXXX investors have an interest in developing local suppliers, XXXXXXX XXXX set up XXXXXXXXXX, raise XXXXXXXXXXXXX and XXXXX XXXXXX, obtain inputs, XXX XXXXXX XXXXXXX. XX XXX XXXX economy, XXXX XX often XXX of the XXXX powerful mechanism for XXXXXXXXXXXX XX XXXX XXXXXXXX. XXX XXXXXXXXXXXXX of these XXXXXXXXX XXX in turn XXXX XX various further spillovers to XXX XXXX XX XXX XXXXXXX through XXXXXXXXXXXXX effects, XXXXXXXX XX trained labor, enterprise spin- XXXX, XXX XXXXXXXXXXX XXXXXXX. </p> <p>22. The extent to XXXXX foreign affiliates XXXXXXXXX backward XXXXXXXX XXXX local suppliers varies from industry XX XXXXXXXX and XXXXXXX to country. Although there XX XXXXXXXXXX concern in developing countries that foreign affiliates have too XXXXXXX connection XXXX the rest of the host economy, XXXXXXX empirical XXXXXXX have demonstrated XXXX in some XXXXXXXXXX (e.g. XXXXXXXXXX) and in XXXXXXXXX XXXXX adequate supplier XXXXXXXXXX XXX XXXXXXX, XXXXXXX investors made XXXXXXXXX XXXXXXX XX upgrade prospective suppliers XXX XXXXXX XXXX XXXX XXXXXXX on local suppliers than XXXXXXXX XXXXX.X </p> <p>23. XXXXXXXXXX, XXX diffusion of best XXXXXXXX in XXX XXXX XXXXXXX depends XX the XXX XXXXXXXX markets XXXX, XX XXXX XX the XXXXXXXXXX capacities of domestic XXXXX. XXXXX XXX market XXXXXXXXX structures are severely XXXXXXXXX, XXX inflows XXXX XXXX XX XX more exploitive XXX rent-seeking in XXXXXX, XXXXXXXX XXXXXXX XXXXXXXX XX XXX XXXX country. XXXXXXXXX, when XXX XXXXXXXX knowledge XXXX XX thin XXX XXXXXXXXXXX XX XXXXXXXXXX, XXX XXXXXXXXX XXXXXXXX XXXX be established for transferring XXXX XXXXXXXX. </p> <p>X. A XXXXXXXXX XXX Social XXXXXXXXXXX </p> <p>XX. XX the XXXX time XXXX FDI XXXXXX XX a catalyst for rapid economic XXXXXX XX enabling XXXXXXXXXX XXXXXXXXX XX XXXXXXXX XXXXXXXXXXXXX XXXXXX and XX catch XX XXXX XXXXXXXX XXXXXXXXX, it constitutes XXXX an important advocate for XXXXXXXX social norms. In XXXX respect, FDI plays a major XXXX in XXX XXXXXX XXXXXXXXXXX agenda XX the XXXX XXXXXXXXX. XXXX, XXX XX XXX main social aspects XX XXXXXXXXXXX – XXXXXXXXXX XXX XXXXXXXXXXX - XXX XXXXXXXXX in XXXXXX. </p> <p>9See XXXXXXXX in XXXX, S. (XXXX), “Vertical interfirm XXXXXXXX in XXXX: an empirical XXXXX,”Oxford XXXXXXXX XX XXXXXXXXX XXX XXXXXXXXXX, Vol XX, No. X. on XXXXX; UNCTAD (XXXX),XXXXX XXXXXXXXXX Reporton Argentina, XXXXXX XXX XXXXXXXX; XXXXX G. XXX H. Tan (XXXX),Interfirm XXXXXXXX XXX productivity XXXXXX: XXXXXXXX XXXX XXXXXXXXX manufacturing, XXX World XXXX; XXX Barnes, J. and R. XXXXXXXXX (XXXX), “Globalization XXX the death XX local firms? Automobile component XXXXXXX in South Africa. </p> <p>X </p> <p>X. Employment XXX XXXXX XXXXXXXX </p> <p>XX. Increasing gainful XXX secure employment has always ranked XXXX XX a XXXXXX XXXXXXXXX for XXXXXXXXXX countries. XX is a principal XXXXX to XXXXXXX an XXXXXXXXX XXXXXXXXXXXX of XXXXXX XXX XXXXXX XXXXXXXX XX welfare for XXX majority of XXX population. Because of XXX special XXXXXXXX XX XXXXXXX XXXXXXXXXXX – they XXXX XX XX XXXXXX in XXXX, with XXXXXXX XXXXXXXXXXXXX sophistication, XXXXXX XXXX competitive pressures in XXXXX XXXXXXX markets, and having more XXXX XX maneuver in their XXXXXXXXXX XX compared XX XXXXXXXX XXXXXXXXXXX – FDI XXXXX XXXXX a unique XXXX in XXXXXXXXXX creation and upgrading XX the host XXXXXXXXX. </p> <p>XX. There XXX XXXXX XXXXX XXXXXXXXXX XXX XXX to generate XXXXXXXXXX in XXX recipient XXXXXXXXX. First, XXXXXXX affiliates XXXXXX XXXXXX in their XXXXXXXX XXXXXXXXXX. Second, XXXXXXX XXXXXXXX and forward XXXXXXXX, XXXXXXXXXX is created in enterprises XXXX are suppliers, subcontractors, or XXXXXXX XXXXXXXXX to them. XXXXX, XX FDI-XXXXXXX industries expand and XXX XXXXX economy grows, employment XX XXXX XXXXXXX in sectors and activities that XXX XXX even XXXXXXXXXX XXXXXX to the XXXXXXXX FDI. </p> <p>27. Comprehensive data XXX absent with respect to the XXXXXXXXXX XXXXXXXXX by XXX in XXXXXXXXXX countries. XXXXXXXXX XXX the XXXXXX XXXXXXXXXX created by XXXXXXX affiliates XX XXXX XXXX XXX percent XX the labor XXXXX in most developing countries, XXXXXXXX the XXXXX would XX XXXXXX when only XXXXXX employment is XXXXXXXXXX and it XX often XXXXXXXXXXX in the modern XXXXXXXXXXXXX sector.10In Thailand, for example, FDI XXXXXXXX for about XX percent of the total XXXXXXXXXXXXX employment in XXX XXXX XXXXX, as well as a XXXXXXX share of new employment XXXXXXXXXX in XXX XXXXXX provinces XXX away from XXXXXXX.11Indirect employment created XX foreign affiliates, by XXXXXXXX, can be large where XXX interaction XXXXXXX XXX XXX XXX local XXXXXXX XX intense. XXXXX on a XXXXXX of eight XXXX studies in XXXX developed and developing countries, XXX study estimated XXXX XXXX only XXX indirect employment generated by backward and XXXXXXX linkages XXX considered, X.X XXXX XXXX XXXXXXX indirectly XXX XXXX XXX created XXXXXXXX XX a XXXXXXX XXXXXXXXX.12 </p> <p>XX. While thequantityof employment XXXXXXXX ranks high in XXX policy agenda of XXXXXXXXXX countries, thequalityof the XXXX XXXXXXX through FDI XXXXXXXXXXX the policy makers XXXX equal weight. Despite XXX XXXXXXX notion that XXXXXXX XXXXXXXXX XXX XXXXXXXXX to XXXXXXXXXX XXXXXXXXX principally, or even solely, XX the low labor XXXXX, realities point XX the XXXXXXXX. XX XXXX, there is general XXXXXXXXX that multinational XXXXXXXXX provide employment on XXXXXXXXXX that, XX the XXXXX, compare favorably with XXX prevailing </p> <p>XXXXXXXX,XXXXX Investment XXXXXX, 1994. 11Brimble, P. and X. Sherman (1998). “XXX Broader XXXXXXX XX foreign XXXXXX XXXXXXXXXX XX XXXXXXXX development in Thailand: XXXXXXXXX responses.” Paper prepared XXX XXXX Level XXXXXXXXXX on FDI and XXX Impact on Poverty XXXXXXXXXXX, December 1998. XXXXXXX, C XXX J. XXXXXX (XXXX). “XXX effets XXXXXXXXX des entreprises multinationales sur l’XXXXXX XXX XXXX d’accueil. » ILO Working Paper No. XX. </p> <p>10 </p> <p>practices in XXXX countries. In XXXXXXXXXX, well-XXXXXXXXXXX large multinational XXXXXXXXXXX XXX XXXX XXXXXX to comply XXXX international XXXXX standards XXX XXXXXX good XXXXX XXXXXXXXX. XXXXXX, because XX their XXXX, XXXXXXXXXXXXX XXXXXXXXXXXXXX, XXX XXXX XX XXXX high XXXXXXX standards, XXX XXXXXXXX to XXXXXXXXXXXXX XXXXXXXX, XXXXXXX affiliates XXXX XXXX to XX XXXXXXXX to offer higher XXXXXXXXXXXX, XXXXXXXX XXXXXXX conditions, XXX XXXX XXXXX XXXXXXXXX opportunities XX XXXXX workers XXXX XXXXXXXX XXXXX. </p> <p>XX. In XXXXXXXX XX XXXXXXXXXXXXX spillovers, best employment practices XXX XX transferred to host countries when the XXXXXXX XXXXXXXXXX are XXXX XXXXXXXXXX XXXX the local economy. XX XXXX respect, the XXXXX-border diffusion XX XXXXXX XXXXXXXXXXXXXX and managerial techniques XXX the XXXX impact XX XXX working XXXXXXXXXX XXX human XXXXXXXX development styles of the XXXXXXXXX countries. XX XXXXXXXX a XXXX efficient XXX XXXX productive work XXXXXXX, XXX helps XX XXX XXX employment XXXXX XXX XXXXXX labor standards in the relevant XXXXXXXXXX XXX localities. In China, XXX XXXXXXX, it XXX through foreign XXXXXXXXXXX that a new XXXX of XXXXX-XXXXXXXX system XXX XXXXX introduced in XXX early 1980s, XXXXX XXXXXX XXXXXXXXXXXX XXX XXXXXXX to XXXXX productivity. XXX XXX reward system XXX so XXXXXXXXXX XXXX it eventually led XX the country-wide XXXX XXX labor market reforms. </p> <p>XX. Finally, XX XXXX of the cross-border XXXXXXXX of its human XXXXXXXX XXXXXXXXXX practices, FDI XXXX XXXXXX with it the XXXX XX XXXXXX industrial relations XXXX are prevalent in advanced XXXXXXXXX.XXXX XXXXXXX, foreign investors adapt their XXXXXXXXXX XXXXXXXXX systems XX the legislations XXX XXXXXXXXX of their host countries. XX XXXXX so, XXXXX approach XX XXXXXXXXXX-labor XXXXXXXXX XX influenced by XXX attitudes of XXX host country governments. XXX XXXXXX character XX XXX, however, suggests that XXXXX foreign XXXXXXXXX XXX XXXXXX practices that differ in XXXX respects from XXXXX XX XXXXXXXXXX enterprises in a host country. Internationally, XXXXX is a broad trend XXXXXXX increased XXXXXXXXXXXXX XXXXXXX management and XXXXXXX. XX XXXXXXXXXXXXX corporations XXX typically XXXXX XXXX invest in XXXXX workforce and XXXX XXXX workers’ XXXXXXXXXXXXX with a view XXXXXXX XXXXXXXXXXXX an XXXXXXXXX relationship, industrial XXXXXXXXX XXXXXXXXXXXX do XXX arise XXXX frequently in foreign affiliates than in XXXXXXXX XXXXX. XXXXXXXXXX, XX XXX XXXXXX XXXX their labor XXXXXXXXX XXX more XXXXXXXXXXXX in nature owing XX XXXXX XXXXXXXXXXXXX XXXXXXXXXXX, XXXXX XXXXXXX XX industrial XXXXXXXXX XXXXX XXXXXXX a model for domestic firms XXX that part XX the XXXXX force XXXX XX XXX organized. </p> <p>2. XXXXXXXXXXXXX Standards </p> <p>XX. XXX XXXXXXXXXXXXX degradation in XXXXXXXXXX countries XX the combined XXXXXXXXXXX XX XXX production and XXXXXXXXXXX patterns both XXXXXX XXX XXXXXXXXX XXX in XXXXX export XXXXXXX. XX a globalized XXXXX economy, the XXXXXX XX XXXXX forces are amplified, with FDI serving XX XXXXXXX conduit. Nonetheless, XXXXX it XX XXXXXXXXXX that XXXXX have XXXX cases where powerful XXXXXXXXX XXXXXXXX polluting XXXXXXXXXX XX countries or regions out of considerations of XXXX XXXXXXXXXXXXX standards, there XX XX conclusive XXXXXXXX that this XX the rule. XXXXXXX, FDI flows XX places XXXXX XXX XXX </p> <p>XXXXXX is most XXXXXXXX XXX investors from West XXXXXXXX XXXXXXXXX. </p> <p>11 </p> <p>XXXXXXXXXXXXX XX XXXXXXX, not XXXXX XXXXX XXX XXXXXX. This XX XXX XXX only most of XXX XXXXX’s XXX XXXXX XX developed countries, XXXXX factor costs are XXXXXX and social standards more XXXXXXXXX, XXXXXXXXX XXXX from XXX United XXXXXX show XXXX XXX XXXXX of XXXXXXXXX-XXXXXXXXX XXXXXXXXXX is XXX highest in developed countries XX XXXX.14Therefore, XXXXX XX no XXXXXX evidence to XXXXXXX XXX XXXXXXXX XXXX FDI is putting XXXXXXXX XX developing XXXXXXXXX to lower their environmental XXXXXXXXX so XX not to lose investment and jobs. </p> <p>32. XXXXX have XXXX XXXXXXX XXXXXXX XXXX attempt to XXXX the “XXXXXXXXX haven” XXXXXXXXXX. Both the XXXXXXXXXXX approach, XXXXX examines the relationship XXXXXXX XXXXXXX XXX XXX environmental standards of host XXXXXXXXX, and the location choice XXXXXXXX, XXXXX XXXXXX XXXXXXXXXXXXX XXXXXXXXXX XX a XXXXXXXXXXXX for XXX flows, XXXX XX support this XXXXXXXXXX.XX XXXX in XXXXXXXX case XXXXXXX XXXX XXXXXXXX found XX XXXXXXX the notion that environmental standards were a XXXXXX in XXX XXXXXXXX XXXXXXXXX. XXXXXXX, it XXXXXX XX pointed out XXXX XXXXX XXXX XXXXXXX suffer from selection bias XXXXXXX only XXXXX that have XXXXXXXX XXXXXXX XXXXXXXX were documented.16 </p> <p>33. XXXXXXXXXXX, environmental resources XXX an XXXXX into the production XXXXXXX. The XXXXXX of industrial XXXXXXXXXX on the environment XX thus XXXXXXX linked XX the XXXXXXXXXX XXXXXXXXXX of firms XXX XXXXX XXXXXXXX XX manage environmental XXXXX. Environmental damage tends XX XX greatest in XXX productivity operations XXXX employ XXXXXXXX technology, XXXXXXXX XXXX XXXXXXX, XXXX human resource XXXXXXXXXX XXXXXXXXXX, XXX XXXXXXXXXXX XXXXXX use. XX XXXX context, XX account XX its XXXXXXXX XXXXXXXXXXXXX and management XXXX, XXX XX actually better XXXXXXXXXX XX uphold higher XXXXXXXXXXXXX XXXXXXXXX than XXXXX XXXXXXXX counterparts. XXXXX is indeed XXXX XXXXXXXX to show XXXX the majority XX foreign XXXXXXXXX XXXXXX behave XXXXX XXXX XX the XXXXXXX practice in the recipient county. Rather, they tend to espouse better environmental XXXXXXXXX and XXXXXXXXXX to an XXXXXXXXXXX XX XXXXX XXXXXXXXXXX.17 </p> <p>34. Therefore, instead of XXXXX feared XX a cause for XXX “race to XXX XXXXXX” in developing countries’ effort XX generate growth, FDI XXXXXX XX viewed XX a XXXXX XX XXXXX about XXXXXX environmental XXXXXXXXX. Because XX their XXXXXXXXXXX to the developed world, XXXXX affluent XXX XXXXXXXXXXXXXXX demanding XXXXXXX XXXX for stringent environmental XXXXXXXXXXX and environment-friendly products, FDI can XXXXXX a XXXXXXX for XXXXXXXXXXXX XXXXX technology and sound XXXXXXXXXXXXX management systems. </p> <p>XXXXXXXX,World Investment Report, 1999. XXXXX XXXXX X. (XXXX), “Environmental XXXXXX XXX competitiveness in a globalized economy: conceptual XXXXXX XXX a review of XXX empirical evidence”, in OECD Globalization XXX XXXXXXXXXXX: Preliminary Perspectives; and Eskeland X. and X. Harrison (XXXX), “XXXXXX XX greener XXXXXXXX? XXXXXXXXXXXXX and XXX pollution XXXXX hypothesis” The World XXXX, mimeo. 16UNCTAD XX. cit. 17See XXXXXXX, X. (1987),XXXXXXXXXXXXX corporations, the XXXXXXXXXXX and XXX XXXXX XXXXX, XXXXX Carolina: XXXX XXXXXXXXXX Press; Leonard, X. (1998),XXXXXXXXX XXX the XXXXXXXX XXX XXX XXXXX product, Cambridge: Cambridge XXXXXXXXXX Press; XXXXXX, B. (ed.), (XXXX),XXXXXXX XXXXXXX XXXXX XXX the XXXXXXXXXXX: XXXXXXX XXXX Latin America,Cheltenham: XXXXXX XXXXX XXXXXXXXXX; XXX XXXXXXX , D. (2001), “XXXXXX XX the XXXXXX? XXXXXXX XXXXXXXXXX XXX XXX XXXXXXXXX in XXXXXXXXXX countries,” mimeo, The World XXXX. </p> <p>12 </p> <p>C. Potential Negative Impacts XX XXX </p> <p>35. XX XXXXXXXX in detail in the discussions above, XXX XXX a key XXXX XX play in XXXX countries’ economic XXXXXXXXXXX. This XXXX not XXXX, however, that FDI can XXXXX lead to undesirable outcomes XXXXX all circumstances. XXXXXX, even XXXX XXX best XX intentions, FDI may XXXXXXXXX produce XXXXXXXXXXXXX results XXXX XXX XXXXXXX to XXXX developing countries. It XX also XXXXXXXXXX XXXX, XXXX XXXXXX they XXX, some XXXXXXX investments may be exploitive in XXXXXX and need to be properly regulated. XXXX of XXX negative impacts of FDI are reviewed in the XXXXXXXXX section. XX will XX XXXX, in most cases, these negative effects are a XXXXXXXX to XXX distortions and XXXXXXXXXXXXXX in the XXXXXXXX XXXXXXX. Therefore, they XXX XXXXXXXXXXX XXXXXXXXX with XXXXXXXXXXX policy XXXXX and a sound XXXXXXXXXX framework. </p> <p>X. XXX “XXXXXXXX Out” XXXXXX of XXX </p> <p>36. XXXXXXXXXXXXXXX XXX XXXXXXXXX XXXXXXXX that XXX usually XXXXXXX in proportionally more XXXXXXXXXX than what XXX XX counted for XX XXX alone, there XX the lingering concern XXXX foreign XXXXXXXXXXX may XXXX XXXX the investment XXXXXXXXXXXXX XX XXXXXXXX firms, XXXXXXX XXXXXXX them out XX XXXXXXXX. XXXX a XXXXXXXXX XXX XXXXX in either XXXXXXXXX markets or XXXXXXX XXXXXXX. If XXX foreign XXXXXXXX finances the project by XXXXXXXXX XXXX the XXXX country financial XXXXXX under XXXXXXXXXX of XXXXXX resources, domestic interest XXXXX may XXXX as a result, which may make XXXXXXXXX XXXXXXXXXXXX for XXXX XXXXXXXX XXXXX. Precisely XX prevent this from XXXXXXXXX, Chile, a country XXXX generally XXXXXXX policies towards XXX, XXX XXXXXXXX the XXXXX XX limit XXX access XX XXXXXXX companies XX XXXXXXXX XXXXXXX XXXXXX. Even though XXX provision has never XXXX XXXXXXX, XXX XXXX XXXXXXXXX XXXXXXXXX to the unease XXXXX small XXXXXXXXXX countries XXXX XXXX potential XXXXXXXX.18 </p> <p>37. If XXX enters XXX economy in activities in XXXXX XXXXXXXXX XXXXXXXX XXXXX already XXXXX, FDI XXX well XXXXXX XXXXXXXX investments XXXX would have been undertaken by XXXXXXXX producers. Even in new XXXXXXXXXX XXXXXX XXX current XXXXX XX XXXXXXXX investors, FDI XXX preempt investments by domestic firms XXXXX, with proper nurturing, could XXXXX XXX XXXXXX XXXXXXXXXXXX. XXX problem XXXXXXX all the XXXX XXXXX if the foreign XXXXXXXXXX deliberately uses predatory practices to force competitors out of XXXXXXXX, or to XXXXXX their establishment. Especially in XXXXXX where XXX host governments XXXX XXXXXXXXX competition policy tools and skills to keep such XXXXXXXX in check, a strong FDI presence XXX XXXXXXX XXX development XX local XXXXXXXXXX. In most cases, crowding out by FDI XXXX XXX necessarily mean an XXXXXXXX XXXXXXXXX in XXXXX investment, but XXXXXX XXXX XXX increase XX XXX XXXXXXXXXXXXX XX XXX inflows. </p> <p>38. XXXX XXXXX XXXXXXXX XXXXXXXX that while XXXXXXXX in or XXXXXXX XXXXXXX of XXX XXXXXXXX, crowding out is not XXXXXXXX XXXXXX. Much XXXXXXX on XXX domestic market </p> <p>XXXXXXXX op. cit. </p> <p>XX </p> <p>XXXXXXXXX. In an econometric exercise carried out to XXXXXXXXXXX XXXX XXXXX, it XXX XXXXX XXXX neutral XXXXXXX dominated in XXXX of XXX XXXXXXXXX, while crowding in XXX crowding out occurred with XXXXX frequency, taking place in 25 XXXXXXX XX the countries each.19A XXXXXXX conclusion is XXXX whereas XXX XXXXXXXXX of XXXXXXXX out XXXXXX be ruled out, it XXXX not appear XX be the general case. Equally inconclusive are the XXXXXX XXXXXXX to XXXX the XXXXXXX. XX XXXXX, for XXXXXXX, XXX XXXXXX to restrict XXXXXXX investments in certain industries XXXXXX XXX to XXX emergence of XXXXXXXXXX domestic XXXXXXXXX. In XXXXXX, XXXXXXX, the XXXX policy intervention in the XXXXX proved XX XX XXX only XXXXXX but XXXX uncertain XXXXXXX. XXX XXXXXXX is thus XXXX instead of trying to avoid the problem XXXXXXX “XXXXXXXXXXX”, i.e. prohibiting FDI XXXX entering XXXXXXX sectors, efforts should concentrate on enforcing appropriate competition XXXXXXXX XXX XXX related regulations so XX XX XXXXXXX abusive XXXXXXXXX in XXX domestic XXXXXXX. </p> <p>X. The XXXXXXX of XXXXXXX XXXXXXX XX a XXXXXX of XXX </p> <p>XX. XXXXXXX wide-spread XXXXXXX XXXXXXXXX FDI XX XXXX to the XXXXXX that profits are repatriated, they XXXXXXXXXX a financial XXXXXXX that XXX to XX set XXXXXXX the XXX XXXXXX contribution of FDI XXXXXXX XX a XXXX XXXXXXX’s balance of payment. This XXXXX XXX of XXXXXXXXXXXX XXXXXXXX in XXX XXXXX XXXXX, XXXX a XXXXXXXX XX XXXXXXXXXX XXXXXXXXX XXXXX stringent XXXXXXX exchange constraints. XXXX increased XXXXXXX XXX capital accounts XXXXXXXXXXXXX in many developing XXXXXXXXX, this is less XX a XXXXXXX. However, XX there are XXXXX a number XX countries with various XXXXXXX XX XXXXXXX XXXXXXXX controls, the XXXXXXX XX payment issue remains XXXXXXXX. </p> <p>40. XXXXXXXXXXXX, XXX XXXXXXX XX XXX XXXXXXX XXXXXXX to be restrained. Comparisons of XXXXXXXXXXX XXXXXXXX and XXX XXXXXXX during the 1990s show XXXX XXXX in Africa, XXXXX the repatriation ratio XXX the XXXXXXX (an XXXXXX XXXXXXX of XX XXXXXXX), XXXXX was XXXXX a XXXXXXXX XXXXXXXX XXXXXXX as a XXXXXX XX FDI. XXXXXXXX, several XXXXXXXX XXXXXXX need to be taken into consideration when assessing the balance XX payment impacts XX FDI. XX is often the case, XXX in trade XXXXXXXXXX generates XXXXXXX XXXXXXXXX XXXXXXX exports, XXXXX counter the XXXXXXXXX outflows XX repatriated XXXXXXX. XXXX XXXX projects in non-XXXXXXXX activities, XXX XXX XXXXXXX the XXXXXXXXXXXXXXX of XXXXXXXX XXXXXXXXXX, XXXX contributing XX XXX overall XXXXXX XXXXXXXXXXX of XXX host country. XXXXXXXXX, in the long run, FDI should XXX be a XXXXX for XXX balance XX payment XXXXXXX, except in XXXXXXXXX with XXXXXXXXX misaligned XXXXXXX XXXXXXXX regimes. XX this case, the XXXX solution XX XXX restricting FDI, XXX rather XXXXXXXXXX the XXXXXXX XXXXXXXX constraints XX XXX XXXXXXXXX. </p> <p>X. Enclave XXXXXXXXX XXXXXXX XX FDI </p> <p>41. XXX XXXX voiced XXXXXXX XXXX XXXXXX to XXX is undoubtedly that such XXXXXXXXXXX XXX XXXXXXXX based, with limited overall impact on XXX receiving countries, XXX benefiting XXXX a small XXXXX XX XXX XXXXXXXXXX. XXXX XXXXXXXXX are most XXXXXXXXXXX by XXX XXXXXX XXX other raw XXXXXXXX extraction XXXXXXXX, which XXX typically XXXX XXXXXXX XXXXXXXXX XXX </p> <p>XXXX XXX. </p> <p>14 </p> <p>XXXXXX a XXXXX fraction of the national XXXXXXXXX. XXXX means that few XXXXXXXX, XXXXXX XXXXXXXX or XXXXXXX, exist XXXX the host XXXXXXXXX, XXXXXX their XXXXXXXX XXXXXXX XX XXX domestic economy negligible. To XXXX XXXXXX worse, XXXXXX large XXXXXXX XX XXXXXXX XXXXXXXX tend to XXXXX the real XXXXXXXX XXXX XX the host XXXXXXX XXX thus render XXXX non-XXXXXXXXXX XXXXXXXXXX unprofitable (XXX XXXXX XXXXXXX). XXXXXXXX, such projects often XXXXXXX XXX XXXXXXX retention XXX XXXX XXXXXXXXX XXXXXXX a XXXXX XXXXXXXX XX export XXXXXXXX flow XXXXXXXXXXX overseas XX service the XXXXXXX XXXXXXX investment.20 </p> <p>42. Another XXXXXXX of the enclave XXXXXXXXX XX the XXXXXX XXXXXXXXXX Zones (EPZs), which have become a popular XXXXXXXX in XXXXXXXXXX XXXXXXXXX XX XXXXXX XXXXXXX and to XXXXXXX employment. With XXX wide XXXXX XX exemptions XXX XXXXXXX XXXXXXXXXX granted XX investments XXXXXXX in the EPZs, they too XXXXXXX very XXXXXXX linkage with XXX local XXXXXXXXX XX large. In XXXXXXXXXX, XXX labor XXXXX and XXXXXXXXX of normal rules and XXXXXXXXXXX are often XXX main advantages sought by the XXX in XXXX locations, who XXXX tend to be footloose XXX XXXX XXXXXX incentive XX transfer XXXXXX or technologies. Consequently, even though the immediate export XXX XXXXXXXXXX benefits are XXXXXXXXXX, XXX XXXX-XXXX XXXXXXXXXXXXXX and XXXXXXXX XXXXXXX XX these XXXXX are XXXX certain. </p> <p>XX. However, XXXXXXX the natural tendency XX mining XXXXXXXX and XXXX XXXXXXX enclave XXXXXXXXX, this does not XXXX to be XXX XXXX and it XX XXX XXXXXX enough for XXXXXXXXXX country governments to shun XXXX XXX foreign investments XXXX XXXXX activities. What XXXX need to do XX to XXXXXX XXX XXXXX incentives XXX proper environment for XXXX XXXXXXXXX to XXXXXXX XXX XXXXX of XXXXX XXXXXXXXXX. In the mining XXX XXXXXXX resource projects, for example, XXXXX XXXX XXXX successful examples XX countries XXXXX managed XX use prudent macroeconomic policies XX XXXXX XXXXXXX excessive XXXXXXXX XXXX XXXXXXXXXXXX XXX XXXXX regulations XX XXXXXXXX the XXXXXXXXXXXXX XX insiders XXX XXXXXXXXXX XXX XX use XXX XXXXXXXX XXXXX XXX XXXXXXX alleviation.21In XXXX XXXXXXXXXX XXXXXXXXX, XXXX XX the EPZs XXX turning into “smart” zones XXXX a number of strategies to ensure XXXXXXX technology and XXXXXX transfer XXXX XXXXXX and outside XXX zones. </p> <p>XXX. XXX XXXXXXXXXXXX of XXX Location </p> <p>44. XXXX the rising importance of FDI in world XXXXXXX, XXXXXXXX XXXXXXXX have been made to XXXXXXX XXX XXXXXXX XXXX explain XXX XXXX and location. As XXXXXXXX by XXXXXXX (XXXX), “XXX growth XX XXXXXXX XXXXXX XXXXXXXXXX has XXXX excelled XX XXX XXXXXX XX XXXXXXXXXXXX XXXXXXXXX XX XXX determinants of these investments.”XXXXXX XXXXX angle and XXX both XXXXXXXXX XXX XXXXXXXXXX countries, XXXXXXXXXXX have examined </p> <p>20See Auty, X. M. (XXXX),Sustaining development in XXXXXXX XXXXXXXXX: the XXXXXXXX curse thesis, XXXXXX: Routledge; and XXXXX, J. and A. M. XXXXXX (1995). “XXXXXXX resource abundance and economic XXXXXX.” NBER Working Paper XXXX. XXXXXX examples include Botswana, Chile, XXXXXXXXX, XXXXXXXX, XXXXXXXXX, XXXXXX XXX Oman. 22Agarwal, X.X. (XXXX). “XXXXXXXXXXXX of XXXXXXX XXXXXX XXXXXXXXXX: a XXXXXX,”Weltwirtschaftliches Archive, Vol. XXX. </p> <p>XX </p> <p>political, XXXXXXXX, social, and XXXXXX XXXXXXXXX in their search for “the most important” determinants XX FDI XXXXX. XXX discussion below synthesizes XXX results XX this vast literature and XXXXXXXXXX the basic elements of attractiveness XXXX draw foreign investors to a XXXXXXX. </p> <p>XX.XXXXXX demand. The XXXXX XX XXX XX positively XXXXXXXXXX by XXX size XX a XXXXXXX’s market demand as XXXXXXXX XX XXX XXX capita. XXXX confirms the XXXXXX XXXXXXXXXXX XXXX XXXX XXX XXXXX to XXXXXXXX XXXX XXXXXXXXX and it XX XXXXXXXXXXXX XXXX XXXX market-seeking XXXX of XXX. XXXX in developing countries, XXXXX XXX inflows XXXX XX XX more XXXXX-seeking, a country’s overall XXXXXXXXXXX level still has a XXXXXX bearing XX how XXXX FDI it XXXXXXXX. </p> <p>46.Growth rate. FDI XXXXX to where fast economic XXXXXX XXX been XXXXXXXX. A virtuous circle is observed here: at XXXX XXXX that XXX contributes XXXXXXXXXXXXX to economic XXXXXX, faster XXXXXXXX growth XXXXXXXX more FDI XXXXXXX it XXXXXXXXX XXXXXXX investors’ XXXXXXXXXX in XXX economy, XXXXX in turn XXXXXX the XXXXXX rate even XXXXXX. In the least XXXXXXXXX countries, XXXXXXX XXXX XXXXX XXXX XXX in XXXX XXXXXXX, XXX proceeds, some initial XXXXXX or at least XXX promise of XXXXXX. </p> <p>47.XXXXXXXXX stability. Quite XXXXXXXXXXXXXX, XXXXXXXXXX XX XXXXXXXXX XXXXX, XXXXXXXXXXXXXX, XXXXX, or armed XXXXXXXXX may XXXXX a XXXXXXXX XXXXXXXX XXXXXXXXX on foreign XXXXXXXXX’ investment XXXXXXXXX. XXXXXX, frequent XXXXXXX of governments XXX the XXXXXXXXX policy XXXXXXX XXX XXXXXX an XXXXXXXX’s assets XX zero XXXXXXXXX. XX XXX XXXXXXX of XXXXXXXXXXX reserves of XXXXXXXXXXXX XXXXXXX resources (e.g. XXX), rarely XXXXX any XXXXXXX investors accept XXXXXXX political XXXXX or frequent XXXXXX XXXXXXXXX. </p> <p>48.XXXXXXXXXXXXX XXXXXXXXX. A country’s overall macroeconomic XXXXXXXXXXX, such XX low XXXXXXXXX XXXX XXX balanced XXXXXX account, XX a XXXXXXXXXXXX significant XXXXXX in XXXXXXX XXX XXXXXXXX XXXXXX XX XXXXXXX investors XXXX assessing investment XXXXXXXXX. Because XXXXXXXXXXXXX XXXXXXXXXXX makes it XXXXXXXXX for XXXXXXXXX XX XXXXXXXX XXX true XXXXX XXX XXXXXXX XX XXXXX investments, XXXX in XXXX cases would FDI flows to XXXXXX XXXXX there XX XXXXXXXXXXXXXX or severe imbalances in their XXXXXXXX XXX XXXXXXXX XXXXXXXXX. </p> <p>49.Infrastructure. XXXX XXXXXXX XX FDI, infrastructure encompasses both physical (e.g. XXXXX XXX power) XXX XXXXXX (e.g. XXXXXX XXX XXXXXXXXX) concepts. XX has been XXXXXXXXXX shown around the XXXXX XXXX a well-developed XXXXXXXXXXXXXX XXXXXXX XXX a well-trained XXXXX force XXX major XXXXXXXX of XXXXXXXXXXXXXX XX foreign XXXXXXXXX. This XX especially XXXX XXXXX high XXXXXXX FDI (e.g. long-term transfer XX advanced technology) XX concerned. </p> <p>XX.XXXXXXXXXX XXXXXXXXXXX. XX is XXXXXXXXXXXX XXXXXXXXXX XXXX the XXXXXXXXXXXXXX XXX XXXXXXXXXX environment of a country XXX XXXX a significant XXXXXXXXX on the level XX XXX flows. While large XXX powerful investors XXX be able to XXXXXX cumbersome and costly XXXXXXXXXX, they may prove fatal XX XXX entry XXX growth XX XXXXX XXX XXXXXX XXXXXXXXXXX. Moreover, XXXXXXXXX, XXXXXXXXXXXXXX, and non-transparent XXXXXXXXXXX XXXXX lead to corruption, which has XXXX XXXXX XX XX a XXXXX XXXXXXXXX XX XXX. </p> <p>16 </p> <p>XX.XXXXXXXXXX promotion. XXXX a XXXXXXX has established a XXXXXXXXXX appealing XXXXXXXXXX XXXXXXX, how much XXX it XXXX depends also on its XXXXXXXXX efforts XX attract XXXXXXX XXXXXXXXXX. XXXXXXX, no amount XX promotion XXX substitute XXX a XXXXX XXXXXXXXXX-XXXXXXXX environment, but when XXXXX XXXXXXX are similar – as it XXXX in XXXXXXXXX XXXXXX attained a certain level of XXXXXXXXXXX – promotion efforts do make a difference. </p> <p>52. In this XXXXXXX, XXXXXXX should be made to XXX fiscal incentive schemes XXXX XXXX governments often XXXX XXXXXXX XX offer in order to attract XXX. XXXXX XXXX XXXXXX XX examples XX such “tax XXXXXXX” which XXX XXXXXX XXXXXXXXXX with XXXXXX XXXXXXXXXXXXX XXXXXXXXX. XXXX XXXXXXXX XXXXXXX and surveys of international XXXXXXXXX, XXXXXXX, have repeatedly shown XXXX these XXXXXXXXXX XXX not XXXXXX XX influential in XXX location XXXXXXXXX XX XXXXXXX XXXXXXXXX XX it XX XXXXXXX believed. XXXX is, even though all XXXXXXXXX would seek the lowest tax liabilities XXXX it XX possible – just like XXXX XXXXX XXXXXX low XXXXXX costs XXXX XXX other XXXXXXXXXX XXX XXXXX - the various factors discussed XXXXX XXX far XXXX important in their site XXXXXXXXXX than XXXXXXX XXXXXX XXXXXXXXXX. XXXXXXX investment XXXXXXXXXX are XXXXXX for a XXXXXXX to XXXXXXX XXX XXX XXXX XXXXX XX incentives XX XXX XXXXXX largely XX XXX nature of the XXXXXXXXXXX investors’ activities, XXXXX XXXXXXXXXX XXX XXXXXXXXX abroad, XXXX whom the XXXXXXX XXXXXXX is XXXXXXXXX XXX XXXXX XXXXXXXXX, XXX if the XXXXXXX has XXX fiscal XXXXXXXX XX swallow the revenue XXXXXX and XXX XXXXXXXXXXXXXX XXXXXXXX to manage its chosen XXXXXXXXX XXXXXXX. XXXXXXX, global companies give XXXX XXXXXXXXXX to XXX XXXXXXXXXX XXX XXXXXXXXX XX a XXXXXXX’s XXX XXXXXX than generous XXX rebates. </p> <p>XX. What Do XXX XXXXXX Need XX Do? </p> <p>53. The XXXXXXXX discussions XXXXXXXXX the XXXX XX XXX in XXXXXXXX development – XXXXX XXX a XXXXXXX, it is a XXXXXXXX XXXXXXXXXX XX XXX long XXXX XXXXXXXXXXX growth. For developing countries, it XXXXXXXX the XXXX XXXXXXXXX way XX XXXXXXX productivity XXX to develop an internationally XXXXXXXXXXX private XXXXXX; it XXXXXXX employment XXX XXXXXX XXXXXXXXXXXXX; and it XXXXXXXX an XXXXXXXXX XXXXXXX XX raise XXXXXXXXXXXXX and XXXXXX standards. XXXX developing countries have reaped these benefits. But neither FDI nor all its XXXXXXXX flow automatically. XXXXXXX investors are XXXXXXXX people whose first and XXXXXXXX XXXXXXXXX for XXXXXXXXX anywhere XX XX XXXXXXXX their XXXXXX XXXXXXX, XXXX or without benefits XX XXXX XXXXXXXXX. XXXXXXXXXXX XXXX simple business XXXXXXXXX, it is possible to bring out the XXXX sides of FDI XXX XXXXX its negative XXXXXXX. </p> <p>54. Moreover, XXXXXXX XXX XXXXXXXXXX potential XX FDI in economic development, it XXXX XXX XXXXXXX XXXXXXX XX XXX XXXXXXXXXXXXX problems. For example, while FDI XXXXX XXXXXXX XXXXXX levels, it XXXXXX XXXXXXXXXXXXX reduce existing XXXXXXXXXXXX and XXX XXXX XXXXXXXXXX them in the XXXXX XXX by putting a XXXXXXX on XXXXXX with XXXXXX XXXXXX. Public policies XXXX to XX in XXXXX XX support the XXXXXX XXXXXXXX of XXXXXXX. XXX XXXX XX FDI in XXXX XXXXXXX is, XX XXXXXX of its impact XX productivity XXX XXXXXX, XX XXXXXXXX the </p> <p>XX </p> <p>XXXXXXXXX XXXXXX XX XXXX XXX government-led XXXXXXXX XXXX improve XXXXXX safety nets and provide XXXXX XXXXXX XXXXXXXX. Moreover, the XXXXXXXX of social XXXXXXXX to the poor – from XXXXXXXXX schemes XX XXXXXX to basic XXXXXXXX XXXX XX XXXXX and XXXXXX – XXX XXXX XXXXXXX from XXXXXXXX on foreign investors. It is XXXX XXXXXXXXXX for the XXXXXXXX governments to create the pre-XXXXXXXXXX XXX FDI to flow in XXX XXXX XXX XXXXXXX. </p> <p>XX. The XXXX fundamental XXX- requisites XXX FDI are enumerated in the previous section. XXX governments need thus to provide (i) XXXXX XXXXXXXXX XXX XXXXXXXXXXXXX XXXXXXXXX XXXX XXXXXX XXXXXXXXXX XXXXXXXXXXXXXX so XXXX XXXXXXXXX can XXXX normal XXXXXXXX decisions; (ii) a XXXXX-based legal XXX XXXXXXXXXX XXXXXXXXXXX XXXX XXXXXXXXXXX XXXXX business XXXXXX XXXX XXXXXXXXX it; (iii) an adequate XXXXXXXX XXX social XXXXXXXXXXXXXX XXXX XXXXXX XXX XXXXXX XXXXXXXXXXX of XXX XXXXXX XXX XXXXXXXXXXXX of knowledge; XXX (iv) appropriate investment XXXXXXXXX XXXXXXX XXXX XXXXXXXXXXX information about the XXXXXXXXXX site XXX service existing XXX XXXXXXXXX XXXXXXXXX. </p> <p>56. Beyond these basic XXXXXXXXXX, XXX XXXXXXXXXXX XXXX XXXX XXXX to XXXXXXX several specific XXXXXX in order XX ensure XXX realization of the benefits of FDI. XXXX XXXXXXX:XX </p> <p>XX.An XXXX and competitive playing XXXXX.The XXXXXXXX of XXX tend XX be XXXXXXXXX when foreign investors operate on an XXXX XXX competitive XXXXXXX field. To XXXX end, governments need to provide a XXXXXXXX environment where XXXXXXXXXXX, free entry, consumer XXXXXX XXX XXXX exit determine XXX XXXXX XXX XXX XXXXX. Foreign XXX domestic investors XXXX to be XXXXXXX equally XX XXXX XX possible.24As amply XXXXXXXXXXXX in XXXXXXXX literature, exposure XX XXXXXXXXX XXXXXXXXXXX XX an XXXX XXXXXXX field XX the most important XXXXXXXXX for XXXXXXX and domestic companies XX upgrade technology XXX management XXXXXXXXX, while XXXX XXXXX XX the XXX to establishing XXXXXXXXX linkages XXXXXXX XXXXXXX XXXXXXXXX XXX domestic suppliers XXX XXXXXXXXXXXX that help diffuse best practice in the XXXX XXXXXXX.25 </p> <p>XX.Domestic XXXXXXXX XX XXXXXXX FDI XXXXXXXX.X liberal and competitive investment XXXXXXX XXXXXXX XXX XXXXX for FDI to XXXXX XXX raise the XXXXXXXXX XXX productivity growth in the XXXX economy, XXX XXXXXXXXXXXX XXXX XXXX occur XX XXX XXXXXXXX XXXXXX are XXXXXXX XX responding XX XXX new XXXXXXXXXX. As XXXXXXXXX in the previous XXXXXXXX, XXX XXXX XXXXXXX deterrent to wider XXXXXXXXX XX XXXX practice XX a lack of XXXXXXXXXX XXXXXXXXXXXX to XXXX XXXXXXXXX of the opportunities. The key policy measures are thus to XXXXXXX the XXXXXXXXX and XXXXXXXXXXXXXX so XX to XXXXXXXX the XXXXXXXX XXXXXXXXXX XXXXXXXX of XXX fruits XX XXX. </p> <p>59.Building up environmental and XXXXXX standards.XX XXXXXXXXXXXXX gradually XXXXX to XXXXXX environmental and XXXXXX XXXXXXXXX XX XXX, governments need XX adjust their </p> <p>XXXXXX XXXXXXXXXX XXXXX from Klein XX XX. (2001). XXXX is XXXXXXXXXX that given the XXXXXXX features XX XXX as XXXXXXXX XX domestic investments, differences in XXXXXXXXX are not entirely XXXXXXXXX. But XXXX XXXX XX be XXXX to a XXXXXXX. XXXXX XXXXXXXX XXXXXXX XX XXX are XXXX XXXXX linked to uncompetitive XXXXXXXXX in XXX domestic markets XXX selective protections XXXXXXX to certain XXXXX. See Lall, S. and P. XXXXXXXX (1977),XXXXXXX XXXXXXXXXX, XXXXXXXXXXXXXX and XXXXXXXXXX countries, XXXXXXXX XXXXX; XXX Graham, E. H. (1995). “Foreign XXXXXX investment in the world economy.” IMF Working XXXXX XX/95/59. </p> <p>XX </p> <p>own XXXXXXXX to XXX into XXX XXXXXXXX XXXXX XXXX. In XXXXXX where there remains a XXXX gap XXXXXXX the world standards XXX XXXXX XX a host country, reputable XXXXXXX XXXXXXXXX may XX XXXXXX to stay away out of reputational XXXXXXXX or XXXX XXX face XXX XXXX XXXXXXXXXXX from domestic firms not XXXXXXX XX as XXXXXXXXX norms. To be sure, XXXXXXX XXXXXXXXX XXXX XXXXX, which XXX affect both XXXXXXXX XXXXX and XXXXXXX low-cost-seeking XXX. XXXXXXXXXXX have XX decide how to XXXXXXXX themselves XXX XXX XXXX term benefits of their economic XXXXXXXXXXX. </p> <p>19 </p> <p>XXXXXXXXXXXX </p> <p>XXXXX J. “Environmental policy XXX competitiveness in a globalized XXXXXXX: XXXXXXXXXX XXXXXX XXX a XXXXXX of the XXXXXXXXX XXXXXXXX”, in OECD XXXXXXXXXXXXX XXX XXXXXXXXXXX: Preliminary XXXXXXXXXXXX, XXXX. </p> <p>Agarwal, J.X. “XXXXXXXXXXXX XX foreign direct XXXXXXXXXX: a XXXXXX,”XXXXXXXXXXXXXXXXXXXX XXXXXXX, XXX. XXX, 1980. </p> <p>XXXXXX, X. and X. X. XXXXXXXX. “XX XXXXXXXX XXXXX benefit XXXX XXXXXX foreign XXXXXX investment? Evidence from Venezuela”,The XXXXXXXX Economic Review, XXX. 89, No. X, XXXX. </p> <p>XXXX, R. X.XXXXXXXXXX development in XXXXXXX economies: XXX XXXXXXXX XXXXX XXXXXX, XXXXXX, Routledge, XXXX. </p> <p>XXXXXX, X. and X. XXXXXXXXX. “XXXXXXXXXXXXX and the death of XXXXX XXXXX”. Automobile XXXXXXXXX section in South Africa, XXXX. </p> <p>XXXXX, R.X. “XXXXX on XXXXXX XXXXXXXXXX,” XXXX Working XXXXX No. 6654, 1998. XXXXX X. XXX H. Tan.Interfirm XXXXXXXX and productivity growth: XXXXXXXX </p> <p>form Malaysian manufacturing,XXXXX, XXX World Bank, Washington, X.C., XXXX. XXXXXXXXXXX, E. and J. X. Lee. “XXX XXXX foreign XXXXXX XXXXXXXXXX affect economic </p> <p>growth?”, XXXX Working Paper No. XXXX, XXXX. </p> <p>XXXXXXX, X. XXX J. XXXXXXX. “XXX XXXXXXX impacts XX foreign XXXXXX investment XX XXXXXXXX development in XXXXXXXX: XXXXXXXXX responses”, 1998. </p> <p>XXXXXXX, S. XXX X. XXXXXXX. “Foreign investment XXX productivity growth in XXXXX XXXXXXXXXXX”, XXXXXX XXXXXXXX XXXXXXX Paper XXXX, XXX XXXXX XXXX, XXXXXXXXXX, D.C., 1998. </p> <p>Dupuy, X XXX J. XXXXXX. “XXX XXXXXX indirects XXX XXXXXXXXXXX multinationales sur l’XXXXXX XXX XXXX d’acceuil”, XXX XXXXXXX XXXXX No. 72, XXXX. </p> <p>Eskeland X. XXX X. XXXXXXXX. “Moving to greener XXXXXXXX? XXXXXXXXXXXXX and XXX XXXXXXXX XXXX XXXXX, Kenya XXX Zimbabwe,” RPED XXXXX No. XX, The World XXXX, Washington, D.C., XXXX. </p> <p>Gentry, X. (ed.).XXXXXXX XXXXXXX XXXXX XXX XXX environment: lessons XXXX XXXXX America,XXXXXXXXXX, XXXXXX Elgar XXXXXXXXXX, 1998. </p> <p>20 </p> <p>Graham, E. X. “XXXXXXX direct XXXXXXXXXX in the world economy.” XXX XXXXXXX Paper XX/XX/59, 1995. </p> <p>Klein, M., X. Aaron, and B. Hadjimichael. “XXXXXXX XXXXXX XXXXXXXXXX and poverty XXXXXXXXX”, XXXXXX XXXXXXXX XXXXXXX XXXXX No. 2613, The XXXXX Bank, XXXXXXXXXX, X.X., XXXX. </p> <p>Lall, S. “Vertical inter-firm linkages in XXXX: an empirical study,”Oxford XXXXXXXX XX XXXXXXXXX and Statistics, Vol. XX, No. 3 XX XXXXX, 1980. </p> <p>Lall, S. and P. Streeten.Foreign investment, XXXXXXXXXXXXX and developing XXXXXXXXX, XXXXXXXX Press, 1977. </p> <p>XXXXXXX, X.Pollution and the struggle XXX XXX XXXXX XXXXXXX, Cambridge, Cambridge XXXXXX, XXXXXXXXX, XXXX. </p> <p>Maddison, X. “XXXXXX XXX XXXXXXXX in advanced XXXXXXXXXX ecibinues: techniques XX XXXXXXXXXXXX XXXXXXXXXX”,Journal XX Economic XXXXXXXXXX, Vol. XX, 1987. </p> <p>Paper XXXXXXXX XXX XXXX Level Roundtable XX XXX and its Impact XX XXXXXXX Alleviation, December 1998. </p> <p>Pearson, X.Multinational corporations, XXX XXXXXXXXXXX XXX XXX third world, North XXXXXXXX, Duke University Press, XXXX. </p> <p>Ramachandran, X. and M. X. XXXX. “The effects XX XXXXXXX XXXXXXXXX in XXXXXX: evidence XXXX XXXXX, XXXXX XXX Zimbabwe”, XXXX XXXXX No. XX, The XXXXX XXXX, XXXXXXXXXX, X.C., XXXX. </p> <p>Sachs, J. and A. M. Warner. “XXXXXXX resource abundance and XXXXXXXX XXXXXX.” XXXX Working Paper </p> <p>XXX XXXXXX XXXXXX Charter, XXXX. </p> <p>XXXXXX,XXXXX Investment Report, XXXX. </p> <p>UNCTAD,World XXXXXXXXXX XXXXXX, XXXX. </p> <p>UNCTAD.World XXXXXXXXXX Reporton Argentina, Brazil XXX Thailand, XXXX. </p> <p>Wheeler , X. “Racing XX XXX bottom? XXXXXXX investment XXX air XXXXXXXXX in developing XXXXXXXXX”, mimeo, The XXXXX Bank, Washington, X.C., 2001. </p> <p>XX </p> <p> </p>">
