Browsing by Subject "Spillover effect"

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    Does foreign direct investment promote growth? Exploring the role of financial markets on linkages
    (Elsevier BV, 2010) Alfaro, L.; Chanda, A.; Ozcan, S. K.; Sayek, S.
    Do multinational companies generate positive externalities for the host country? The evidence so far is mixed varying from beneficial to detrimental effects of foreign direct investment (FDI) on growth, with many studies that find no effect. In order to provide an explanation for this empirical ambiguity, we formalize a mechanism that emphasizes the role of local financial markets in enabling FDI to promote growth through backward linkages. Using realistic parameter values, we 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. © 2009 Elsevier B.V. All rights reserved.
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    ItemOpen Access
    Knowledge spillovers, transboundary pollution, and growth
    (Oxford University Press, 2002) Alemdar, N. M.; Özyildirim, S.
    Trade in natural resources is construed as a dynamic game between North and South. Policies that promote growth in the North also cause knowledge spillovers and transboundary pollution in the South. Cooperative and noncooperative Nash equilibria of this strategic trade game are simulated under various scenarios by parallel genetic algorithms to highlight the distortions in the growth/pollution trade-off. Absent cooperation, both regions benefit when North simultaneously cuts waste and increases knowledge spillovers, impelling South to reciprocate by lower resource prices.