Foreign Direct Investment and Foreign Portfolio Investment under Asymmetric Information

• Main Author: SUWANTARADON, Ruanjai
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2009
• Subjects: Foreign direct investment; international capital flows; asymmetric information; corporate governance.; Finance; Growth and Development
• Online Access: https://ink.library.smu.edu.sg/soe_research/1339; https://ink.library.smu.edu.sg/context/soe_research/article/2338/viewcontent/Ruanjai_20Suwantaradon.pdf
• Institution: Singapore Management University

This paper develops a model of international capital flows when there is asymmetric information between foreign investors and domestic managers. Direct investors have a direct influence on the management, thus overcoming agency and information problems. This information advantage, however, comes at...