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

• 成果类型: Article
• 署名作者: Alfaro, Laura; Chanda, Areendam; Kalemli-Ozcan, Sebnem; Sayek, Selin
• 署名单位: Harvard University; National Bureau of Economic Research; Louisiana State University System; Louisiana State University; University of Houston System; University of Houston; Ihsan Dogramaci Bilkent University
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2009.09.004
• 发表日期: 2010
• 页码: 242-256
• 关键词: FDI spillovers; Backward linkages; financial development; Economic growth

摘要

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. (C) 2009 Elsevier B.V. All rights reserved.