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Fdi, Growth And The Role Of Governance: Changing The Rules Of The Game

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  • Constantina Kottaridi

Abstract

This paper synthesises theoretical predictions on economic globalisation with the International Business and Economics disciplines in order to provide new insights on the link between Foreign Direct Investment (FDI) and growth. We empirically investigate the impact of foreign investment on recipient EU economies for the last two decades, based on the correspondence principle between organisational hierarchical pyramids and the hierarchical structure of the global economy. Our results are supportive of a bi-polar EU where the higher value-added activities are concentrated in core countries. We claim that there is a need for re-evaluating existing governance so that peripheral economies can improve their domestic characteristics, e.g. by enlarging their human capital basis, and be able to attract and maintain FDI. Copyright 2005, Oxford University Press.

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  • Constantina Kottaridi, 2005. "Fdi, Growth And The Role Of Governance: Changing The Rules Of The Game," Contributions to Political Economy, Cambridge Political Economy Society, vol. 24(1), pages 79-98, August.
    • Handle: RePEc:oup:copoec:v:24:y:2005:i:1:p:79-98
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    Cited by:

    1. Samuel Adams & Berhanu Mengistu, 2008. "Privatization, Governance and Economic Development in Developing Countries," Journal of Developing Societies, , vol. 24(4), pages 415-438, October.
    2. Yamin, Mo & Sinkovics, Rudolf R., 2009. "Infrastructure or foreign direct investment?: An examination of the implications of MNE strategy for economic development," Journal of World Business, Elsevier, vol. 44(2), pages 144-157, April.

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