Multinational firms and backward linkages : a critical survey and a simple model

Ping LIN, Kamal SAGGI

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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 languageEnglish
Title of host publicationDoes foreign direct investment promote development?
PublisherCenter for global development, Institute for International Economics
Pages159-174
Number of pages16
ISBN (Print)9780881323818
Publication statusPublished - 1 Jan 2005

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