Publication date: 25 October 2017 Source: Author: Ivana Slavoljub Domazet, Darko Milivoj Marjanović The main aim of this work is to determine, on the basis of empirical research, whether and to what extent foreign direct investment has impact on the overall economic development of selected countries in the Western Balkans. Analyses made for the purpose of this paper were performed on the basis of available secondary data possessed by the World Bank for the period of 2000-2012. The (...) research methodology involved the use of the techniques of linear regression and correlation analysis. The first task was to determine whether there is an impact of foreign direct investment on the overall economic development of these countries. Where such influence occurred, it was necessary to define its level in comparison to the influence of other variables. The results of the analysis in this paper suggest that inflow of foreign direct investment does not affect to a significant extent the economic development of selected countries in the Western Balkans. (shrink)

While there had still been an increasing flow of foreign direct investment (FDI) into China during the 2002 downturn in FDI globally, such investments have historically been only sporadically successful. Much writing has detailed and discussed problems associated with China FDI but several costs remain dangerously overlooked. One such cost is that of micro-monitoring plants for work conditions and employee treatment in violation of local Chinese laws and possible home country ethics. Further, a more personal cost is (...) presented – the personal cost associated with maintaining an investment in a facility that violates standards of ethical employee treatment. Background information related to these issues is presented, along with a general overview of FDI in China. (shrink)

As foreign direct investment in the U.S. continues to become both more visible and controversial, the general public remains skeptical about the corporate citizenship of these foreign affiliates. Four dimensions of corporate citizenship — orientations, organizational stakeholders, issues, and decision-making autonomy — were used to compare the inclinations of foreign affiliates with the domestic firms operating in the U.S. chemical industry. The only significant differences between the U.S. sample and those firms headquartered in other countries-of-origin (...) were found in the area of corporate citizenship decision making autonomy. (shrink)

This paper examines the foreign direct investment decision from an ethical perspective, and considers the moral agency involved in such decisions, with emphasis upon the corporate decision-maker. Historical capital allocation models once regarded as both financially and ethically normative are shown to be deficient in today's environment. Work of modern western philososphical and theological ethicists is included in analyses of the applicability of selected ethical approaches or metaphors to multinational foreign direct investment decisions and (...) the corporate manager's role and responsibility as corporate decision-maker and moral agent. The ethical perspectives reviewed can serve as an aid to the individual manager's determination of what constitutes a responsible exercise of decision-making power. (shrink)

Based on 2010 to 2019 Chinese outward foreign direct investment panel data from 39 host countries, this paper studies the relationships between host country cultural characteristics and Chinese OFDI. The OLS regression results show that the cultural tolerance and trust in the host countries are significantly positively correlated with Chinese OFDI, which are robust according to the system GMM tests. Further analysis reveals that cultural tolerance is more positively related to Chinese OFDI in host countries with higher (...) legislation and economic freedom, while cultural trust is positively associated with Chinese OFDI in host countries with lower legislation and economic freedom. In addition, higher cultural tolerance and trust promote Chinese OFDI in countries with greater cultural distance. Unlike traditional studies based on cultural distance in international trade, using more representative cultural characteristics, this paper provides references to Chinese OFDI decision-making based on the root characteristics associated with heterogeneous cultural influences. (shrink)

This study aims to analyze the impact of Foreign Direct Investment, external debt and population growth on economic progress of Pakistan by using time series data from 1980 to 2014. It analyzes the correlation between Gross Domestic Product,FDI, external debt and population growth. Augmented Dickey Fuller test has been used to check stationarity in time series data. To evaluate the empirical results multiple regression method is used. GDP has been used as a dependent variable while FDI, external (...) debt and population as independent variables. Findings of this paper show the positive and significant impact of FDI, and population growth on GDP but external debt has negative impact on GDP. (shrink)

We examine the relationship between Japanese foreign direct investment (FDI) and the national corporate responsibility (NCR) environment in host countries using corporate social responsibility and international business theories. Based on data from the Japanese Government’s Ministry of Finance AccountAbility, and other sources, we find that the level of NCR has a positive relationship with FDI inflow for developing countries. The relationship for developed countries is negative but not statistically significant. The underlying host country development stage moderates the (...) relationship. The results can help deepen understanding of FDI behaviors and have practical implications for host countries in terms of attracting FDI. (shrink)

Regional integration over the past decade has facilitated a huge flow of foreign direct investment (FDI) into Latin America. Less is known, however, about why these newforeign enterprises decided to enter specific markets. This study investigates three recent investments in Costa Rica: two by U.S.-based multinational corporations (MNCs) and another by an MNC based in Spain. The behavior of these MNCs is examined in their initial bargaining and subsequent operations. Through the lens of political economy, this study (...) concludes that Costa Rica’s stable democratic institutions and formalized economic links through multilateral and regional trade and investment accords constitute an advanced factor of comparative advantage that attracted foreign investment to Costa Rica and induced the MNCs to become responsive to host country interests. (shrink)

In an effort to reduce risk and uncertainty, we hypothesize that investors avoid countries where high corruption exists. We investigate this issue by examining the relationship of levels of perceived corruption on Japanese Foreign Direct Investment (FDI) in both industrialized and emerging economies. The analysis presented utilizes a sample of 29,546 investments in 59 countries. Results suggest that in emerging nations, where comprehensive legal and regulatory frameworks do not exist to effectively curtail fraudulent activity, corruption serves to (...) reduce FDI. Managers need to consider the level of perceived corruption in their assessment of any market prior to potential investment. (shrink)

Because of China’s tremendous increase in foreign direct investment over the past two decades, this method of internationalization has become increasingly significant for companies worldwide. Heavy industry’s dominant role in China’s industrial structure must be modernized to ensure the country’s long-term growth and prosperity. There are 30 provinces in China covered by this dataset, which dates back from 2005 to 2018. Augmented mean group and common correlated effects mean groups estimations demonstrate that China’s industrial upgrading and resource (...) allocation considerably impact FDI inflows. The findings show that FDI inflows appear to be negatively affected by environmental rules. The results show that industrial upgradation and environmental regulations have not had the expected effect on FDI in China without the participation of other stakeholders. For the selected panel, the results from the control variable show that population aging reduces foreign direct investment inflows, whereas, economic growth increases FDI inflows. According to our findings and those of the empirical study, we make some policy proposals to help Chinese provinces attract more foreign direct investment by encouraging and upgrading the screening of such investments. (shrink)

Interest in sustainability is increasing, and research on ESG management continues. The first issue to be discussed in the present situation is the environment. The study between the environment and internationalization was conducted around two conflicting arguments. First, the pollution haven hypothesis states that multinational corporations move to countries with looser regulations depending on environmental regulation. Next is the Porter Hypothesis, which argues that well-designed environmental regulations offset the cost of compliance and ultimately help firms gain a competitive advantage through (...) innovation that enhances performance. However, the two arguments have not yet reached a consensus conclusion. In addition, studies on the national level and studies considering the distance between countries, an important factor in international management, are lacking. This manuscript aims to revisit the relationship between the strength of environmental regulation and foreign direct investment in the context of increasing environmental concerns. Differences between countries are an important field of international management, but research on environmental regulations is lacking. The purpose of this study is to examine the relationship between existing environmental regulations and FDI and to discuss how the distance between countries can affect existing theories. (shrink)

Since the “The Belt and Road” initiative was put forward in 2013, China's foreign investment growth rate has been greatly accelerated. In The Belt and Road context, many scholars used models to analyze the relationship between foreign direct investment, trade flows, and import and export trade. From literature reviews, it is found that previous scholars do not conform to reality and cannot be studied dynamically. Therefore, this study used the panel data of China's foreign (...) direct investment and import and export trade in 40 countries along “The Belt and Road” from 2010 to 2019 to focuses on the impact of foreign direct investment on trade flows, import trade and export trade. Regression analysis was carried out with the trade gravity model and Tinbergen's trade gravity model. In addition to model variables and arguments, the following control variables were adopted: exchange rate, natural resource rents, labor force population, differences in consumer ability, trade openness, and trade agreement signing. The results found that: Foreign direct investment has a positive correlation with trade flow and import and export trade. The labor force population has a negative correlation with trade flow, and import and export trade. The expansion of China's economic scale can increase the scale of China's import and export trade, at the same time, the gap in consumption levels between the two countries will restrict the degree of import and export trade. The possession of natural resources can also promote the development of trade. (shrink)

Australia and India have had few reasons in the past to develop systematic and significant levels of economic engagement. This was due to very different positions they have held in the world-system since the Second World War. De-colonization, the fall of the British Empire, the weak status of the British Commonwealth, and the realpolitik of the Cold War saw India and Australia located on different parts of the geo-political and economic world map with small demographic and cultural flows, and insignificant (...) economic trade. Both countries developed similar economic policy regimes that were essentially state-led nationalist projects of economic development with concomitant policies of import-substitution, local industry-subsidization, highly-regulated financial systems, and high tariffs. The last quarter of the 20th century saw a radical revision of both nations’ economic strategies, with Australia moving first to drop many of its trade barriers in the 1970s and ’80s. It is now one of the most open economies in the world. India’s liberalization programme commenced much later in 1991 but nonetheless has had a dramatic impact on its economic fortunes and growing status in the world economy. With these changes there are increasing opportunities for bilateral trade and a greater economic enmeshment in regional engagements and alignments in the Indian Ocean and in wider Asian fora. One significant indicator of change in growing Australia-India economic engagement is to look at Foreign Direct Investment (hereafter FDI). Currently, the movement of FDI between these two countries is still not very large but has a strong potential to grow over the short to medium term. This paper looks at the future prospect of this growth and asserts that, by engaging in areas of comparative advantage, it will benefit both national economies. Moreover, economic flows are also indicators of great social and cultural traffic. The movement of FDI between the two countries will not only encourage greater flow of peoples, especially outward migration from India to Australia, but also trigger more Australian expatriates living in India (from a very low base). Greater economic trade promises more cultural exchange. (shrink)

Do foreign direct investment (FDI) and international business ventures promote positive social and economic development in emerging nations? This question will always prove contentious. First, the impacts differ according to context. Second, the social consequences and spillover effects of knowledge diffusion and technology-sharing may be limited and hard to measure. Third, contributions to enhancing social responsibility and improving living standards in host countries are delayed in effect, causally complex, and also hard to measure. Outcomes often critically depend (...) on collaboration of governments, international institutions, the business world, and non-governmental organizations (NGOs). Research in this area is challenging and requires interdisciplinary collaboration between economists, financial experts, sociologists, ethicists, and other specialists. This paper explores: (1) the evidence to support the proposition that FDI and international business improve social conditions in less-developed countries, and: (2) how these improvements are linked to strategies of corporate social responsibility (CSR) and ethical business practice. The paper draws insights from development, FDI, poverty alleviation, and bottom-of-the-pyramid (BOP) literature. Applications are demonstrated using examples from poverty-stricken areas of Sub-Saharan Africa. The paper attempts not only to argue theoretically but also to provide practical evidence. The approach is simultaneously descriptive, analytical, and prescriptive in order to address a wide audience. It also highlights issues and trends for further academic research and presents the viewpoint that some limitations lie in the nature of ethics frameworks widely referenced in business and that these often fail to consider the compatibility of ethical constructs with relevant incentives. In this vein, we explore the application of Homann’s framework for advantage and incentive-based ethics. (shrink)

Stakeholder literature tends to presume that effective stakeholder dialogue, occurring directly or indirectly, among a focal firm, local communities, governments, and nongovernmental organizations is desirable for successful firm–stakeholder relationships. Even if theoretically desirable, effective dialogue does not always occur. There are two key theory-informing lessons in Botnia’s Fray Bentos successful green field pulp mill investment and start-up in Western Uruguay. First, critics could not halt the project politically supported by Uruguay in an expanding multi-party international dispute. Second, the Botnia (...) corporate communications process did not succeed in building consensus relationships, and attention was not paid to discourse creating shared meanings among all stakeholders. Participatory relationships were few, and successful dialogue was at best limited to supporters. This article uses discursive analysis to examine how newspaper and press release texts and language used therein both shaped and reflected the dynamically changing nature of firm–stakeholder relations in the Fray Bentos dispute. Despite the focal firm’s professed good intentions to create participatory relationships with its stakeholders during the building project, various stakeholders opposed the project and Botnia was caught in the crossfire of heated debate between Uruguay and Argentina. Three different frames changing over time are identified: the investment frame, the conflict frame, and the political frame. The analysis shows that the relationships between the focal firm and stakeholders involved many meanings only partly shared, due in part to a lack of corporate appreciation for the role of language in managing firm–stakeholder relationships. (shrink)

Source: Author: Uzoamaka S. Chigbu, Chijindu Promise Ubah, Ezeji E. Chigbu The level of bank development has a determinant effect on the growth potentials of a developing economy. In response, this study examined the impact of banking sector development on foreign investment inflows in the West African countries of Nigeria and Ghana. The study relied on secondary data for analysis and made use of multiple regression technique. However, to ensure the authenticity of our result, Augmented Dickey-Fuller unit root (...) test and Johansen Cointegration techniques were respectively employed to test for the presence unit root and long-run equilibrium relationship in the exogenous variables. Additionally, causal relationships were tested with Granger Causality. It was revealed that banking sector development has a significant influence on foreign investment inflows in the two West African countries. Specifically, domestic credit to private sector and bank deposit rate has significant influence on foreign investment inflows in both countries. Whereas domestic credit to private sector is directly related to the dependent variable in Ghana, it is related inversely in Nigeria. It was also discovered that bank lending rate is significantly and positively related to foreign investment in Ghana. Intermediation efficiency and profitability of banks should be improved by enhancing the capital structure and adopting the appropriate lending rate especially in Nigeria as measures to attract more inflows of foreign investment in both countries. ]]>. (shrink)

The paper discusses the Chinese policy environment as regards the experiences of foreign firms in China. In particular, the study focuses on the changes in China’s policies toward foreign-invested firms and the companies’ perceptions of protectionism of the Chinese regulatory environment. Theoretically, the paper reflects approaches in international political economy and business studies on the bargaining relations between host states and firms, and institutional perspective on business strategy that focuses on the dynamic interaction between organizations and their institutional (...) environment. Hence, the approach takes into account the formal and informal institutional constraints that firms face in a particular institutional framework. Drawing from international survey data, as well as interviews with China-based Finnish firms, the paper analyzes the different types of formal and informal protectionism that foreign companies face in China. It is found that foreign firms perceive the Chinese policy measures as increasingly protective, strict toward foreigners, and favoring of local companies. This is based on China’s strategy to remove the earlier preferences for inward foreign direct investment and to support, instead, the growth of indigenous companies. At the same time, the Chinese market presents such a potential that attracts foreign firms to increasingly invest in the country. China has a strong position in competing for investments: its aspiration for higher technology, together with its labor resources, gives China an unique advantage in bargaining with foreign firms over investments. (shrink)

AbstractForeign direct investment (FDI) in offshore financial centers (OFCs) is gaining increased attention in business ethics research. Much of this research tends to focus on OFCs as locations where firms can avoid taxes, considering such behavior as unethical. Yet, there is dearth of studies on capital round-tripping by emerging market firms, which is an integral part of this phenomenon. Such round-tripping involves firms sending capital into OFCs only to invest it back in the home country under the guise (...) of “foreign” investment. Presently there is little discussion of the ethical implications of such round-trip FDI activities. In this paper, we conceptualize round-tripping as institutional arbitrage and look at the determinants and ethical implications of such investments into OFCs. Exploring Russian round-tripping we note that firms tend to invest more funds in OFCs that offer a combination of tax and secrecy, or secrecy and property rights protection arbitrage opportunities. In either case firms exploit the opportunities provided by institutional differences between the OFC and Russia while investing back into Russia. Our results tend to indicate that equating OFC investment to tax avoidance and thus deeming it as unethical behavior is too narrow an explanation in the case of emerging economy round-tripping. This is because such investments are often motivated by the unethical behavior of home country stakeholders and may in fact provide benefits to society. (shrink)

Globalization is multifaceted and involves the interaction among businesses, services, governments, and societies beyond national borders. As a result, the flow of foreign direct investment, international trade in goods and services, and the economic interdependence of the nations of the world have been increasing. At the same time, much attention has been paid to the effect of corruption prevalent within many cultures and societies, and its impact on the economies, especially developing economies. This paper examines the relationship (...) between human capital investment, the level of national corruption, and the global economic integration of a nation in developing countries. Based on the data collected from over 60 countries, and building on the FDI and human capital theories, it was found that human capital investment and corruption are related to GEI. It was also found that the level of corruption moderates the relationship between human capital investment and GEI of developing economies. The findings of the study can help to deepen our understanding of GEI and have practical implications for developing countries in terms developing human capital, which plays a critical role in today’s knowledge-based economy. (shrink)

According to various reports, human rights violations in China include the detention of activists, forced abortions and sterilizations, and the repression of religious and spiritual groups, among others. Yet foreign direct investment in China is growing rapidly, as is outsourcing to Chinese producers. By adapting the Sullivan Principles to China, this essay maps out ethical guidelines for U.S. companies operating in China.

Despite the rich body of research on the outward foreign direct investment (OFDI) by Chinese multinationals, little attention has been given to the fact that China’s OFDI is facing a high failure rate even in their initial attempt to enter a foreign market. Grounded on institutional theory, this study provides a nuanced view of the expansion dynamic of Chinese multinational firms overseas using a unique dataset that contains both successful and troubled Chinese foreign market entry (...) attempts between 2018 and 2021. We find that at the firm level, state-owned firms are more likely to face difficulties when trying to enter a new market compared to their private counterparts. Firms’ corporate social responsibility (CSR) reporting reduces the chance of failure. These effects are conditioned on the political, economic, and cultural distances between the home and host counties. (shrink)

Whether to do business with rights violating regimes is one of many dilemmas faced by socially responsible corporations. In this article the difficult case of Myanmar is considered. Ruled for decades by a closed and sometimes brutal military elite, the country has long been subject to informal and formal sanctions. However, as sanctions have failed to trigger political reform, it is necessary to review the policy options. The focus here is on the contribution socially responsible corporations might make to change. (...) The article sketches contextual features of the case, examines the recent history and present pattern of business links with Myanmar, and assesses whether current approaches can stimulate reform. Concluding that they cannot, it considers fresh possibilities for corporate engagement. The argument is that socially responsible corporations, committed to improving individual life chances through engagement with developing societies, should undertake collaborative and principled direct investment in Myanmar. The underlying strategy and problems of codification and implementation are all analyzed. To close, the article contends that, by doing business with Myanmar’s rights violating regime, multinational corporations can extend the frontiers of global corporate social responsibility. (shrink)

The consequences of foreign direct investment (FDI) for human rights protection are poorly understood. We propose that the impact of FDI varies across industries. In particular, extractive firms in the oil and mining industries go where the resources are located and are bound to such investment, which creates a status quo bias among them when it comes to supporting repressive rulers (“location-bound effect”). The same is not true for nonextractive multinational corporations (MNCs) in manufacturing or services, (...) which can, in comparison, exit problematic countries more easily. We also propose that strong democratic institutions can alleviate negative impacts of extractive FDI on human rights (“democratic safeguard effect”). Using U.S. FDI broken up into extractive and nonextractive industries in 157 host countries (1999–2015), we find support for these propositions.1 Extractive FDI is associated with more human rights abuse, but nonextractive FDI is associated with less abuse, after controlling for other factors, including concerns about endogeneity. We find also that the negative human rights impact of extractive FDI vanishes in countries where democratic institutions are stronger. Our results are robust to a range of alternative estimation techniques. (shrink)

The transition economy of Vietnam enjoyed remarkable achievements in the first 20 years of economic renovation (Doi Moi) from 1986 to 2006. Notably, the economy grew at an average annual rate of 7.5% in 1991-2000 period. Vietnam’s Amended Constitution 1992 recognized the role of private sector in the economy. U.S.-Vietnam Trade Bilateral Agreement (US-BTA) was signed in 2001. The country's stock market made debut trading in 2000. Vietnam became a member of Association of Southeast Asian Nations (ASEAN) in 1995, then (...) proceeded to full membership of the World Trade Organization in 2007, following which registered foreign direct investment (FDI) reached an all-time high of US$71.7 billion in 2008. Together with the impressive economic achievements, Vietnam also saw its diplomatic and political status constantly improved in the international arena. The country has established diplomatic relations with more than 170 countries in the world, strategic partnerships with 12 important economies, both developed and emerging, namely China, Japan, Russia, India, England, France, North Korea, Italy, Germany, Indonesia, Malaysia and Thailand. The country also successfully hosted important events including the Asia Pacific Economic Cooperation (APEC) in 2006. (shrink)

Rankings of countries by perceived corruption have emerged over the past decade as leading indicators of governance and development. Designed to highlight countries that are known to be corrupt, their objective is to encourage transparency and good governance. High rankings on corruption, it is argued, will serve as a strong incentive for reform. The practice of ranking and labeling countries "corrupt," however, may have a perverse effect. Consistent with Social Labeling Theory, we argue that perceptual indices can encourage the loss (...) of needed investment and, thus, contribute to higher rates of corruption within unfavorably ranked countries. In effect, corruption indices may inhibit foreign direct investment, the effect of which is to encourage the status quo in terms of corruption ranking. Using an experimental study design, we test the effects of country corruption rankings on the assessment of country investment desirability and find ranking exposure causes shifts in country investment desirability for 10 of 12 countries studied. These findings suggest that corruption rankings, which are based on perceptions of corruption, may cause country isolation and a reduction in legitimate means of investment. (shrink)

The concept of precision medicine aims to tailor treatment based on data unique to the patient. An example is the use of genetic data from malignant tumours to select the most appropriate oncological treatment. The competing interests of utilitarianism and egoism create dilemmas for decisions regarding investment in precision medicine. The need to balance the perceived rights and needs of individuals against those of society as a whole is an on-going challenge in the distribution of limited health service resources. (...) There is need for proper planning, organisation and investment into precision medicine to cope with the consequences of both direct-to-consumer and healthcare-directed genetic testing for genetic counselling, therapeutics and diagnostic networks. Consideration needs to be given to providing adequate time and training to allow for meaningful shared decision-making with patients and there is a strong case in support of a hub-and-spoke model to provide rapid, solid tumour genetic mutational analysis to prevent patients missing out on beneficial treatments. (shrink)

Four decades have passed since the EU and China established diplomatic relations in 1975, and now became mutually indispensable economic partners, presenting both an opportunity and challenge. During that time, after the first market reforms were introduced in 1978, China has transitioned from a predominantly agricultural to industrial and service-oriented economy. On 11 December 2001, China also became the 143rd member of the WTO. The aim of this research is to quantitatively compare the US, EU and Chinese GDP from 1995 (...) to 2014, the US and Chinese outward FDI from 1995 to 2013, and the EU 28 Total Imports from and Exports to the US and China between 2002 to 2014, and analyse the impact of the exponentially rising Chinese investments in the European Union (EU). We have found that while the US economy experienced a regression in general, and exhibited outward FDI exponential decrease in particular, the Chinese outward FDI sustained an exponential growth. Our analysis has shown that the now weakened US dollar and diminished US economic and industrial power, along with the US designed and archaic post World War II European institutions, vitiated by the recent US Economic Recession, which has swept along the EU and all other US dependent foreign economies globally, are and will continue to experience the primary impact of the exponentially rising economic investment of China in the EU. Furthermore, we have found that the Chinese economic growth has been affecting both the EU identity and policies. Yet, its full effect is waiting to be realized. The Chinese investment in the EU is estimated to peak during the next decade, when China will become by far the foremost economic partner of the EU. This crossroad may be reached as soon as in few years’ time and contribute towards the EU – Asian regional stabilization. In the changing context of the Sino – EU - US relations, due to the exponentially growing economic prosperity and rising global influence of China, the EU international institutions and socio-political structures will re-emerge with the once forgotten access to the 21st Century Silk Road Economic Belt, “The Silk Road II”, between China and the EU in the foreseeable future. (shrink)

A transnational capitalist class has emerged as that segment of the world bourgeoisie that represents transnational capital, the owners of the leading worldwide means of production as embodied in the transnational corporations and private financial institutions. The spread of TNCs, the sharp increase in foreign direct investment, the proliferation of mergers and acquisitions across national borders, the rise of a global financial system, and the increased interlocking of positions within the global corporate structure, are some empirical indicators (...) of the transnational integration of capitalists. The TCC manages global rather than national circuits of accumulation. This gives it an objective class existence and identity spatially and politically in the global system above any local territories and polities. The TCC became politicized from the 1970s into the 1990s and has pursued a class project of capitalist globalization institutionalized in an emergent transnational state apparatus and in a "Third Way" political program. The emergent global capitalist historic bloc is divided over strategic issues of class rule and how to achieve regulatory order in the global economy. Contradictions within the ruling bloc open up new opportunities for emancipatory projects from global labor. (shrink)

This textbook examines how far economic integration in Europe has come. Is it still more useful to view the European Union countries as a set of individual economies, or does it now make more sense to look at them as forming one larger economy? The book attempts to answer this question in a range of expert contributions dealing with all the major aspects of European economic integration, including trade, economic growth, demographics, labour markets, industrial structures, foreign direct (...) class='Hi'>investment, monetary integration and eastern enlargement. (shrink)

Remittances are private financial transfers from migrant workers back to their countries of origin. These are typically intra-household transfers from members of a family who have emigrated to those who have remained behind. The scale of such transfers throughout the world is very large, reaching $338 billion U.S. in 20081—several times the size of overseas development assistance (ODA) and larger even than foreign direct investment (FDI). The data on migration and remittances is too poor to warrant very (...) firm conclusions about their effects—actual or potential—on poverty and development in poorer countries. We will however, present reasons that make it plausible to believe that remittances can contribute to poverty-reduction and promote development in poorer countries. Our main aim, however, is not to engage in detail with empirical debates about the effects of these transfers, but to establish moral grounds for favorable tax treatment on remittances on the assumption that they do have positive effects on receiving countries. (shrink)

This article argues that the quiet politics of informal business-state interaction explains the political determinants of growth regimes. Building on the business power literature within the study of comparative capitalism, it shows that the noisy politics of elections often leads to changes of government but rarely to fundamental changes in the growth regime. Rather, growth models can be traced to the interactions and interests of dominant corporations within a country and its policymaking elites. The argument is developed through a comparative (...) case study research design, using the case of foreign direct investment–led growth in Ireland and Hungary. FDI-led growth regimes are a universe of cases that rely on state-led industrial and enterprise policies targeting the capital investment of foreign-owned multinational firms. Despite periods of noisy electoral politics challenging basic tenets of the FDI-led growth model in both Hungary and Ireland, the continuity of FDI-oriented growth is traced to the corporate politics of business-state elite deals. (shrink)

Clinical trials are essential to establish the safety and efficacy of investigational products, contributing to risk/benefit assessments that ultimately determine whether these products meet the criteria for market authorisation. Clinical trials are also an important source of revenue and expertise generation for countries in which they are conducted. In developing countries, they represent substantial foreign direct investment. In spite of the substantial capital input that clinical trials require, the issue of funding post-trial access to beneficial therapies remains (...) contentious, especially in resource-limited settings. In this article, we explore this situation and propose mechanisms to establish ‘win-win’ situations where both patients and clinical trial sponsors derive benefit from post-trial access programmes in low- and middle-income countries. (shrink)

Proponents of large-scale land acquisitions (LaSLA) argue that poor countries could benefit from foreign direct investment in land (World Bank 2011), while opponents argue that LaSLA is nothing more than neo-colonial theft of poor peasants’ livelihoods, i.e., land grabbing (Borras and Franco in Yale Hum Rights Dev L J, 13: 507–523, 2010a). To ensure responsible agricultural investments (RAI), a voluntary “code of conduct” for land acquisitions has been proposed by the World Bank (2011) and the FAO (2012). (...) A critical reaction to the “code of conduct” approach is the proposal for a set of minimum human rights principles, suggested by the UN Special Rapporteur on the Right to Food, De Schutter (2009). Even more critical of the “code of conduct” approach are Borras and Franco in Yale Hum Rights Dev L J, 13(2): 507–523, 2010a, who propose empowering small-scale farmers by giving them land sovereignty so that they are assured control over their land. This paper is a review of the governance and ethics issues connected to LaSLA. It has four main objectives: First, it offers a critical presentation of three major governance approaches to LaSLA: the “liberal code of conduct” (FAO and the World Bank), the ‘critical liberal human rights’ approach (De Schutter) and the ‘Marxist’ approach (Borras and Franco). Second, it discusses the notion of a human right to land, with reference to John Locke’s theory of appropriating land. Third, it discusses the issue of ensuring an inclusive process in LaSLA. Finally, an argument is made for instituting a (global) obligation to refrain from participating in or benefitting from institutional schemes that facilitate negative land grabbing (Pogge in Politics as usual: what lies behind the pro-poor rhetoric? Polity Press, Cambridge 2010). (shrink)

A large body of scholarship in political economy suggests economic growth, and foreign direct investment in regulated industries in particular, is more likely to occur when formal institutions allow states to provide credible commitments regarding the security of property rights. In contrast, this article argues that we must instead examine differences in firm organizational structure and embeddedness to explain variation in the resilience of privatization contracts in weak institutional environments. Domestic investors—or, if contracts are granted at the (...) subnational level, domestic investors with diverse local holdings—work most effectively in the developing world. Domestic investors are better able to negotiate mutually beneficial adaptations to their formal contracts with host governments because they can draw on informal contractual supports that derive from cross-sector diversification and embeddedness in the market. This article finds strong support for this argument through an analysis of fourteen water privatization contracts in Argentina. (shrink)

Together, China and India account for almost two fifths of mankind. In purchase power parity terms the Chinese economy is the second largest in the world ahead of Japan, and the Indian economy is the fourth largest ahead of Germany. In less than two decades these two big Asian economies together might account for a quarter of the global product. Currently, however, both countries are still poor.Both countries might outgrow poverty, because potential advantages of backwardness as well as fairly strong (...) domestic investment favor growth. Concerning human capital formation China and India differ. China is much better than India in primary school education. Eradication of analphabetism is in sight in China, but far in the future in India. India, however, is much stronger in tertiary education than China. Another major difference between China and India is their degree of integration in the global economy. China benefits much more from the global division of labor than India does. China attracts much more foreign direct investment, too.In the past fifty years, Chinese economic performance was superior to the Indian performance. Nevertheless I reject the interpretation that either China’s autocracy or China’s communist ideology is responsible for China’s better performance. China started to grow faster than the global economy only after Deng Xiaoping liberalized and opened up the economy. Under Mao Zedong and during the great leap forward more than 30 million Chinese starved to death. Similar disasters did not happen in poorer India. If China and India teach a lesson about the impact of regime characteristics on growth, it is the following: Democracy promotes performance quite similar to the global average, autocracy as a constitution of arbitrariness permits much better performance or much worse performance.In the long run, the growth prospects of both China and India depend not only on their own economic policies, but also on Western readiness to take their exports. Open Western markets together with sensible policies in China and India may promote global prosperity and peace.A eux deux, la Chine et l’Inde représentent deux cinquièmes de l’humanité. En termes de capacité de pouvoir d’achat comparé, l’économie chinoise est la deuxième plus grande au monde, devant le Japon, et l’économie indienne est la quatrième plus grande, devançant l’Allemagne. Dans moins de deux décennies, ces deux gigantesques économies asiatiques pourraient représenter conjointement un quart du produit global. Aujourd’hui cependant, ces deux pays sont toujours pauvres.Les deux pays pourraient surmonter la pauvreté car les potentialités que recèle un retard économiq- ue ajoutées à un investissement intérieur relativement soutenu favorisent la croissance. En ce qui concerne la formation du capital humain, des différences existent entre la Chine et l’Inde. La Chine est meilleure que l’Inde dans le domaine de l’éducation primaire. L’éradication de l’analphabétisme semble être en vue en Chine mais est loin d’être une partie gagnée en Inde. A l’inverse, l’Inde devance la Chine dans le domaine de l’éducation tertiaire. Une autre différence majeure entre la Chine et l’Inde concerne leur degré d’intégration dans l’économie globale. La Chine bénéficie davantage de la division globale du travail que l’Inde. De plus, la Chine attire plus d’investissements directs de l’étranger. Durant les cinquante dernières années, la performance de l’économie chinoise a été supérieure à celle de l’Inde. Néanmoins, l’auteur rejette l’interprétation suivant laquelle ce serait ou l’autocratie chinoise ou l’idéologie communiste qui serait à l’origine de cette supériorité. La Chine commença à croître plus rapidement que l’économie globale seulement après que Deng Xiao Ping a libéralisé l’économie chinoise et ouvert ses frontières. Sous le règne de Mao Tsé Tung, et durant le “grand bond en avant”, plus de 30 millions de chinois sont morts de famine. De tels désastres n’ont pas été observés en Inde qui est relativement plus pauvre. Si une leçon peut être tirée des expériences chinoise et indienne à propos de l’impact des caractéristiques des régimes sur la croissance économique, c’est la suivante : la démocratie promeut des performances assez identiques à la moyenne globale, et l’autocratie en tant que constitution de l’arbitraire donne lieu à des performances bien meilleures ou bien pires. A long terme, les perspectives de croissance de la Chine et de l’Inde dépendent non seulement de leurs propres politiques, mais aussi de la volonté des pays occidentaux de digérer leurs exportations. Des marchés occidentaux ouverts et des politiques intelligentes en Chine et en Inde peuvent promouvoir la prospérité et la paix au niveau global. (shrink)

Transition economies have inherited of a lot of outdated or blackwarded facilities in many industries from the socialist period. Restructuring such enterprises or industries need massive inputs of investment and technology. Privatisation and foreign direct investment provide answers to this problem, but at the price of important lost of control over the concerned bodies. Here we consider the situation of Hungarian telecoms which have been successfully privatised to Deutsch Telecom and try to assess the results of (...) the operation and the effects on the potential growth of the industry and more generally on the Hungarian economy.Les économies en transition ont hérité de la période socialiste un certain nombre d’entreprises et de secteurs aux installations largement obsolètes. Leur mise à niveau constitue un préalable à l’amélioration qualitative des productions, des processus de production, et par conséquent à une élévation progressive des salaires réels et des niveaux de vie. Cette opération nécessite des injections massives de capitaux et de technologie. La privatisation des entreprises concernées, en particulier au bénéfice d’investisseurs étrangers, peut apporter une solution, mais au prix d’une perte importante de contrôle.Ici, nous examinons la situation des télécoms en Hongrie, qui ont été privatisées au profit de l’entreprise elle-même, du point de vue de l’industrie des télécommunications, et plus généraleme- nt in s’interroge sur les effets qu’elle peut avoir sur l’ensemble de l’industrie hongroise. (shrink)

"This book contains ideas to develop interdisciplinary and transdisciplinary views on economy and society. It aims to disseminate heterodox ideas on various subjects related to economics and global society. The book is organised in six parts. Part 1 contains the key lectures of Backhaus on the concept of state sciences and of Klamer on the importance of culture for economics. Parts 2- 6 contain successively contributions in the areas of economic paradigms and theories, population and society, corporate issues, environment, and (...) international relations. Examples of the content are: - the changes of family life cycles due to the rise of non-traditional households; - subjective and objective inflation rates after the introduction of the Euro; - the economics of genetic engineering; - the contribution of foreign direct investment to the economic development of host countries; - the inaccuracy of economic models applied in places characterized by extreme income disparities; - the improvement of political and corporate governance; - evolutionary thinking and emission trading; - freedom and order in the European Union; - the reform of social policy in Europe. The book provides interesting creative multi-disciplinary ideas with respect to various topical issues concerning the contemporary global society. It is highly recommended for economists and social scientists in search of broad views on social science and society.". (shrink)

PurposeThe purpose of this paper is to investigate the emancipatory promises and realities of information and communication technology in Egypt.Design/methodology/approachThe combination of Habermasian and Foucauldian ideas implemented by a critical discourse analysis of the Egyptian Information Society Policy and interviews with employees of local decision support systems employees. Promises and rhetoric are contrasted with findings and questioned with regards to their validity.FindingsOn the policy level, analysis shows that the emancipating rhetoric of ICT is not followed through. ICT is mostly seen (...) as a means of attracting foreign direct investment. Neither political participation nor educational benefits are promoted seriously. On the local level, culture and organisational realities prevent individuals from exploiting the emancipatory potential of the technology.Originality/valueThe combination of the Habermasian and Foucauldian approach exposes the problems of ICT use in developing countries. It shows that emancipation is used to legitimise ICT policies but is not taken seriously on a policy level in Egypt. Local implementations also fail to deliver on their promise. In order to have emancipatory effects, ICT policy and use will need to be reconsidered. (shrink)

Extensive research has been carried out on the “Belt and Road” initiative, most of it focusing on geographical economy and international trade. However, there is a lack of research on the carbon emissions efficiency of the countries along the “Belt and Road,” especially regarding the impact of freight trade. To address this research gap, this paper first employs a metafrontier nonradial directional distance function to measure the carbon emission efficiency of 32 countries along the “Belt and Road” from 1990 to (...) 2014. It then examines the role of freight trade. Our main research findings are as follows. Firstly, the carbon emission efficiency of the countries along the “Belt and Road” is generally low. Among them, Russia and Central Asia are mainly due to the large between-group gap in carbon emission efficiency, while Southeast Asia, Western Asia and North Africa, East Asia, South Asia, and Central and Eastern Europe are mainly due to the large within-group gap. Secondly, freight trade promotes carbon emission efficiency, but it will aggravate the gap between the contemporaneous technology and the group technology. Freight trade mainly promotes the contemporaneous carbon emission efficiency and group-frontier carbon emission efficiency of low fossil energy dependent countries, and the metafrontier carbon emission efficiency of high fossil energy dependent countries. Thirdly, foreign direct investment has a significant negative effect on a host country’s ITCEI and GTCEI, and it will decrease the gap between the group technology and the metafrontier technology. However, freight trade can effectively prevent the entry of FDI, thereby indirectly improving carbon emission efficiency and reducing carbon emission gap. (shrink)

This paper uses panel OLS, IV, and system GMM methods to empirically study the effects of manufacturing and producer service corporate co-agglomeration on green economy efficiency in China. Chinese panel data from 2000 to 2019 are collected to assess the GEE and co-agglomeration degrees. The regression results show that there is an “inverted U-shaped” relationship between co-agglomeration and GEE. However, regional heterogeneity is found in the effects of corporate co-agglomeration on GEE. The mediating analysis indicates that corporate co-agglomeration could increase (...) GEE through business entrepreneurship and innovation entrepreneurship. Variables such as transportation infrastructure, human capital, foreign direct investment, and environmental regulations are also found to have an elevating effect on GEE, whereas local fiscal expenditure on environmental protection has little effect. The findings in this paper indicate that entrepreneurship plays an important role in the process of co-agglomeration impacting GEE which differs in different regions and thus provide references for corporate and regional sustainable development. (shrink)

As an economic pillar, major resource consumer, and polluter of cities, the chemical industry determines many cities’ transformation, prosperity, and decay. It is thus a major concern for achieving the UN Sustainable Development Goals. In China, which is at the stage of accelerated industrialization that is varied across regions, the chemical industry has gradually retreated from developed cities, such as Beijing and Shanghai, in the eastern region, and has become the inevitable choice for industrialization of less-developed cities, such as Xi’an, (...) Chengdu, and Chongqing, in the western region. This study took the perspectives of chemical industrial sectors and their spatial differences to understand the changing patterns of the chemical industry and its dominant cities. It identified chemical industrial cities, examined their spatial-temporal patterns with respect to their industry scale and structure, and accounted for factors influencing the spatial evolution from coastal areas to inland regions. The results show that large CICs were mainly located in coastal port regions with balanced industrial sectors, while small CICs were mainly distributed in inland areas with abundant oil and coal resources and a single dominant industrial sector. The location factors of ports, markets, and technology play important roles in the eastern region, while resource conditions and foreign direct investment promote the chemical industry’s development in the central, western, and northeastern cities. These findings improve the understanding of CICs’ spatial transformation and shed light on the policy-making of chemical industrial development in China and other developing countries. (shrink)