Climbing the economic ladder : the role of outward foreign direct investment

• Main Authors: Lim, Guanie, Teo, Jie Khan
• Other Authors: School of Social Sciences
• Format: Article
• Language: English
• Published: 2018
• Subjects: DRNTU::Social sciences::Economic theory; Foreign Direct Investment; Developing Country
• Online Access: https://hdl.handle.net/10356/82512; http://hdl.handle.net/10220/46737
• Institution: Nanyang Technological University

This paper argues that, under certain conditions, outward foreign direct investment (FDI) can promote economic development in the home economies from which the investment originates. It presents a conceptual framework incorporating simultaneously the complex interrelationships between the three main tenets shaping the developmental outcomes of outward FDI – the home economy conditions that induce firms to invest abroad; the role of the state in linking outward investment to economic development back in the home economy; and the investment returns which stimulate catching-up. The framework helps researchers and policymakers assess particular characteristics of outward FDI and their impacts on the home economies.