The series captures the experience, innovative approaches and solutions for development of the World Bank Group covering financial sector topics of relevance to both the public and private sectors. The series is comprised of short knowledge notes, policy notes, case studies, lessons learned or a combination therein. This series was formerly known as Finance in Focus.
This note provides an up-to-date summary
of the academic evidence around the drivers and channels for
technology transfer and productivity spillovers by
multinational corporations (MNC) operating in host
economies. Foreign direct investment (FDI) is a major
contributor to development. Besides the direct benefits FDI
brings in terms of increased capital, employment and
exports, the presence and operations of MNCs can also help
improve the productivity of local firms through backward
linkages and offer an important channel for the integration
of local firms into global value chains (GVC). However,
several market failures exist that get in the way of these
linkages and spillovers fully materializing. This note
highlights the main challenges as well as some policy
recommendations for host economy Governments to consider.
(Washington, DC: World Bank, 2019-12-31)
Heilbron, Armando; Whyte, Robert
A well-functioning institutional
framework can result in higher levels of foreign direct
investment. It requires several factors such as a shared
strategic vision, solid institutions capable of delivering
on their specific mandates and collaborating beyond their
walls, and a strong political and financial support for all.
The note describes key government functions for investment,
suggests a process and principles for creating optimal
institutional structures to deliver them, and provides
examples. In particular, it examines the role of investment
promotion agencies (IPAs) the agency usually tasked with
operationalizing government FDI goals as well as the
dilemmas that governments face in the context of
institutional specialization versus function consolidation.