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dc.contributor.authorAlfaro, L.en_US
dc.contributor.authorOzcan, S. K.en_US
dc.contributor.authorSayek, S.en_US
dc.date.accessioned2016-02-08T10:05:19Z
dc.date.available2016-02-08T10:05:19Z
dc.date.issued2009en_US
dc.identifier.issn0378-5920
dc.identifier.urihttp://hdl.handle.net/11693/22831
dc.description.abstractThis paper examines the effect of foreign direct investment (FDI) on growth by focusing on the complementarities between FDI inflows and financial markets. In our earlier work, we found that FDI is beneficial for growth only if the host country has well-developed financial institutions. In this paper, we investigate whether this effect operates through factor accumulation and/or improvements in total factor productivity (TFP). Factor accumulation - physical and human capital - does not seem to be the main channel through which countries benefit from FDI. Instead, we find that countries with well-developed financial markets gain significantly from FDI via TFP improvements. These results are consistent with the recent findings in the growth literature that shows the important role of TFP over factors in explaining cross-country income differences. © 2009 The Authors Journal compilation © 2009 Blackwell Publishing Ltd.en_US
dc.language.isoEnglishen_US
dc.source.titleWorld Economyen_US
dc.relation.isversionofhttp://dx.doi.org/10.1111/j.1467-9701.2009.01159.xen_US
dc.subjectCapital flowen_US
dc.subjectComplementarityen_US
dc.subjectFinancial marketen_US
dc.subjectForeign direct investmenten_US
dc.subjectGrowth rateen_US
dc.subjectHuman capitalen_US
dc.subjectTotal factor productivityen_US
dc.titleFDI, productivity and financial developmenten_US
dc.typeArticleen_US
dc.departmentDepartment of Economicsen_US
dc.citation.spage111en_US
dc.citation.epage135en_US
dc.citation.volumeNumber32en_US
dc.citation.issueNumber1en_US
dc.identifier.doi10.1111/j.1467-9701.2009.01159.xen_US
dc.publisherWiley-Blackwell Publishing Ltd.en_US
dc.identifier.eissn1467-9701


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