Does foreign direct investment promote growth? Exploring the role of financial markets on linkages

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dc.citation.epage256en_US
dc.citation.issueNumber2en_US
dc.citation.spage242en_US
dc.citation.volumeNumber91en_US
dc.contributor.authorAlfaro, L.en_US
dc.contributor.authorChanda, A.en_US
dc.contributor.authorOzcan, S. K.en_US
dc.contributor.authorSayek, S.en_US
dc.date.accessioned2016-02-08T09:59:34Z
dc.date.available2016-02-08T09:59:34Z
dc.date.issued2010en_US
dc.departmentDepartment of Economicsen_US
dc.description.abstractDo 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.en_US
dc.identifier.doi10.1016/j.jdeveco.2009.09.004en_US
dc.identifier.eissn1872-6089
dc.identifier.issn0304-3878
dc.identifier.urihttp://hdl.handle.net/11693/22397
dc.language.isoEnglishen_US
dc.publisherElsevier BVen_US
dc.relation.isversionofhttp://dx.doi.org/10.1016/j.jdeveco.2009.09.004en_US
dc.source.titleJournal of Development Economicsen_US
dc.subjectBackward linkagesen_US
dc.subjectEconomic growthen_US
dc.subjectFDI spilloversen_US
dc.subjectFinancial developmenten_US
dc.subjectDevelopment economicsen_US
dc.subjectEconomic growthen_US
dc.subjectEmpirical analysisen_US
dc.subjectFinancial marketen_US
dc.subjectForeign direct investmenten_US
dc.subjectSpillover effecten_US
dc.titleDoes foreign direct investment promote growth? Exploring the role of financial markets on linkagesen_US
dc.typeArticleen_US

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