Information Externalities Affecting the Dynamic Pattern of Foreign Direct Investment The Case of China
The dynamic pattern of foreign direct investment (FDI) in developing countries shows a three-phase pattern. Despite government policies that promote it, initially the inflow of FDI is sluggish, followed by a period of considerable fluctuation before finally entering the stage of rapid growth. The pa...
Main Author: | |
---|---|
Other Authors: | |
Format: | eBook |
Language: | English |
Published: |
Washington, D.C.
International Monetary Fund
1994
|
Series: | IMF Working Papers
|
Subjects: | |
Online Access: | |
Collection: | International Monetary Fund - Collection details see MPG.ReNa |
Summary: | The dynamic pattern of foreign direct investment (FDI) in developing countries shows a three-phase pattern. Despite government policies that promote it, initially the inflow of FDI is sluggish, followed by a period of considerable fluctuation before finally entering the stage of rapid growth. The paper explains the pattern through recourse to two concepts: the searching process of individual investors and the information externalities of investors in the aggregate. Policy implications that may serve to shift an economy of a developing country from small-scale FDI to one of rapidly expanding FDI are considered. As China is a clear example of this pattern, it has been selected to promote understanding of the process |
---|---|
Physical Description: | 28 pages |
ISBN: | 9781451974645 |