Foreign direct investment as a catalyst
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James R. Markusen; Anthony J. Venables
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Article
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1999
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Elsevier Science
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English
β 179 KB
How does an FDI project affect local firms in the same industry? Competition in the product and factor markets tends to reduce profits of local firms, but linkage effects to supplier industries may reduce input costs and raise profits. This paper develops an analytical framework to assess these effe