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Export-Processing Zone and the Possibility of Welfare Gain with Foreign Capital Inflow

Author

Listed:
  • Kazuhiro Ohara

    (Graduate School of Economics, Kobe University of Commerce)

Abstract

It is shown in a simple model with 'export-processing zone' that exogenous inflow of foreign capital must increase welfare of an economy importing capital-intensive goods and following protectionary policy. It should also be added that this welfare effect depends on reasonable capital-labour ratio of the export-competing sectors in the country concerned.

Suggested Citation

  • Kazuhiro Ohara, 2000. "Export-Processing Zone and the Possibility of Welfare Gain with Foreign Capital Inflow," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 35(2), pages 211-215, July.
  • Handle: RePEc:dse:indecr:v:35:y:2000:i:2:p:211-215
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    References listed on IDEAS

    as
    1. Chaudhuri, Sarbajit & Gupta, Manash Ranjan, 1996. "Delayed formal credit, bribing and the informal credit market in agriculture: A theoretical analysis," Journal of Development Economics, Elsevier, pages 433-449.
    2. Chaudhuri, Sarbajit & Ghosh Dastidar, Krishnendu, 2011. "Vertical linkage between formal and informal credit markets: corruption and credit subsidy policy," MPRA Paper 35563, University Library of Munich, Germany.
    3. Hoff, Karla & Stiglitz, Joseph E., 1998. "Moneylenders and bankers: price-increasing subsidies in a monopolistically competitive market," Journal of Development Economics, Elsevier, pages 485-518.
    4. Floro, Maria Sagrario & Ray, Debraj, 1997. "Vertical Links between Formal and Informal Financial Institutions," Review of Development Economics, Wiley Blackwell, pages 34-56.
    5. Kaushik Basu, 2003. "Analytical Development Economics: The Less Developed Economy Revisited," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262523442, January.
    6. Hoff, Karla & Stiglitz, Joseph E., 1997. "Moneylenders and bankers: price-increasing subsidies in a monopolistically competitive market," Journal of Development Economics, Elsevier, pages 429-462.
    7. Gangopadhyay, Shubhashis & Sengupta, Kunal, 1987. "Small Farmers, Moneylenders and Trading Activity," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 333-342, June.
    8. Gupta, Manash Ranjan & Chaudhuri, Sarbajit, 1997. "Formal Credit, Corruption and the Informal Credit Market in Agriculture: A Theoretical Analysis," Economica, London School of Economics and Political Science, vol. 64(254), pages 331-343, May.
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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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