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  • 2012
  • Chapter
  • The Evidence and Impact of Financial Globalization

Foreign Direct Investment and Growth

By: L. Alfaro and M. S. Johnson
  • Format:Print
  • | Pages:11
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Abstract

This paper examines the evolution of the literature on the relationship between foreign direct investment (FDI) and growth in host countries, particularly developing countries. It provides a broad overview, with a focus on two elements that have recently become particularly important, (1) the role of complementary local conditions conducive to reaping the benefits of FDI (which relate to when FDI will generate growth) and (2) the mechanisms by which FDI creates positive externalities (which relate to how FDI generates growth).

Keywords

Economic Growth; Spillovers; Complementarity; Mechanism; Globalization; Foreign Direct Investment

Citation

Alfaro, L., and M. S. Johnson. "Foreign Direct Investment and Growth." Chap. 20 in The Evidence and Impact of Financial Globalization, edited by Gerard Caprio, 299–309. Elsevier, 2012.
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About The Author

Laura Alfaro

General Management
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  • Discussion of Geoeconomic Fragmentation and the Future of Multilateralism By: Laura Alfaro
  • A Perspective on the Great Reallocation of Global Supply Chains By: Laura Alfaro and Davin Chor
  • Global Supply Chains: The Looming 'Great Reallocation' By: Laura Alfaro and Davin Chor
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