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Foreign Direct Investment as a Catalyst for Industrial Development.

Abstract:

How does an FDI project affect local firms in the same industry? Competition in the" product and factor markets tends to reduce profits of local firms, but linkage effects to supplier" industries may reduce input costs and raise profits. This paper develops an analytical framework" to assess these effects. Circumstances in which FDI is complementary to local industry are" established, and it is shown how FDI may lead to the establishment of local industrial sectors. " These sectors may grow t...

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Authors


James R Markusen More by this author
Anthony J Venables More by this author
Volume:
6241
Publication date:
1997
URN:
uuid:87e0af10-8b94-446b-8684-68c4d4b45e0a
Local pid:
oai:economics.ouls.ox.ac.uk:12017
Language:
English

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