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Human Development and Foreign Direct Investment in Developing Countries: The Influence of FDI Policy and Corruption

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  • Reiter, S.L.
  • Steensma, H. Kevin
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    Abstract

    Summary While policymakers place great importance on foreign direct investment (FDI) in advancing development in developing countries, the links between FDI, economic development, and human development remain tenuous. We attempt to better understand these relationships by looking at the influence of FDI policy and corruption on these relationships. We find that FDI inflows are more strongly positively related to improvement in human development when FDI policy restricts foreign investors from entering some economic sectors and when it discriminates against foreign investors relative to domestic investors. The relationship between FDI and improvement in human development is also more strongly positive when corruption is low.

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    Bibliographic Info

    Article provided by Elsevier in its journal World Development.

    Volume (Year): 38 (2010)
    Issue (Month): 12 (December)
    Pages: 1678-1691

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    Handle: RePEc:eee:wdevel:v:38:y:2010:i:12:p:1678-1691

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    Web page: http://www.elsevier.com/locate/worlddev

    Related research

    Keywords: foreign direct investment economic development human development developing countries;

    References

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    Cited by:
    1. Chris Tofallis, 2013. "An automatic-democratic approach to weight setting for the new human development index," Journal of Population Economics, Springer, Springer, vol. 26(4), pages 1325-1345, October.
    2. John Anyanwu, 2011. "Working Paper 136 - Determinants of Foreign Direct Investment Inflows to Africa, 1980-2007," Working Paper Series, African Development Bank 327, African Development Bank.
    3. Dibyendu Maiti & Arijit Mukherjee, . "Governance, Foreign Direct Investment and Domestic Welfare," Discussion Papers 10/27, University of Nottingham, GEP.
    4. Giorgia Giovannetti & Elisa Ticci, 2013. "Foreign Direct Investment in Sub-Saharan Africa: Drivers and the Challenge of the Land-Energy Nexus," Working Papers - Economics wp2013_09.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.

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