This short paper explores the complementarity between foreign aid and foreign direct investment (FDI). Recent studies on aid concluded that aid should come to an end or be reduced with a radical modification of the terms and conditions and FDI and trade should replace aid as the engine of development. In this paper, we argue that aid complements FDI and advances the efficacy of FDI in promoting...

The process of internationalisation or ‘globalisation’ involves a thorough transformation of the Australian economy from being inward looking and protectionist, to being externally oriented in both trade and investment. The process has been helped along by the liberalisation of capital markets and the removal of barriers to trade, but other factors such as technological advances and innovations...

The question of complementarity or substitutability of FDI and international labour mobility has not yet been answered. The substitutability assumption does not take into consideration the technological spillover of FDI in the host countries. Moreover, migration flows reveal cultural characteristics and labour force properties of their native country which may stimulate bilateral business netwo...

Background A synergy exists between investment liberalisation and the effective application of competition policy. An effective competition policy does not only remove obstacles to entry, but can also facilitate foreign investment flows by providing a predictable legal and regulatory environment that reduces the scope of arbitrary decision-making. Regulation of the business practices of investo...

FDI is, however, risky for the investing firm and often controversial for the host. So while some states and regions in the U.S. have enthusiastically embraced FDI as part of their economic development strategies, other states have not. Successes around the country have led to reconsideration of the previous views of FDI, and most states are now actively seeking investment from overseas, many w...