Multinational firms and backward linkages : a critical survey and a simple model
Does foreign direct investment promote development?
Center for global development, Institute for International Economics
In this chapter, we develop a simple model that explores FDI's effect on backward linkages and that accommodates both of these preceding views. The model considers the effects of a multinational's entry that enjoys market power and also transfers technology to the local economy. We also provide a detailed discussion of the existing analytical work on FDI and backward linkages in order to highlight the contribution made by our model and to indicate avenues for future research.
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ISBN of the source publication: 9780881323818
Lin, P. (2005). Multinational firms and backward linkages: A critical survey and a simple model. In T. H. Moran, E. M. Graham, & M. Blomström (Eds.), Does foreign direct investment promote development? (pp. 159-174). Washington, DC: Center for global development, Institute for International Economics.