IED, globalización y desarrollo económico: hacia la reforma de las reglas del juego nacionales e internacionales

The key analytical and policy question examined in this paper is whether multinational companies and their overseas direct investment (FDI) need to be regulated at the national or the international level, in order to address market failures, and to enhance their potential contribution to world welfare. The paper examines two kinds of regulatory regimes: first the current regime and second, the proposed by the European community and Japan at the WTO (ECJ) to institute fresh global rules of the game which will effectively allow multinationals unfettered freedom to invest where they like, whenever they like, how much and in what products. Very briefly, the central conclussion of the paper is that ECJ, despite of confining itself to only one source of external finance namely FDI, is a flawed proposal both from the perspective of developing and developed countries. Its shortcomings are serious with respect to developing countries as it essentially ignores the developmental perspective altogether.