Abstract
In this chapter, we develop a simple model that explores FDI's effect on backward linkages and that accommodates both of these preceding views. The model considers the effects of a multinational's entry that enjoys market power and also transfers technology to the local economy. We also provide a detailed discussion of the existing analytical work on FDI and backward linkages in order to highlight the contribution made by our model and to indicate avenues for future research.
Original language | English |
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Title of host publication | Does foreign direct investment promote development? |
Publisher | Center for global development, Institute for International Economics |
Pages | 159-174 |
Number of pages | 16 |
ISBN (Print) | 9780881323818 |
Publication status | Published - 1 Jan 2005 |