Publication:
The Effectiveness of Promotion Agencies at Attracting Foreign Direct Investment

dc.contributor.authorMorisset, Jacques
dc.contributor.authorAndrews-Johnson, Kelly
dc.date.accessioned2013-08-14T19:15:55Z
dc.date.available2013-08-14T19:15:55Z
dc.date.issued2004
dc.description.abstractA perplexing question has become increasingly important: Does investment promotion really work? The authors hereby made a major step in providing a convincing answer to this question. Because many countries were not yet trying to promote investment, the authors could conduct a very simple test: compare foreign direct investment (FDI) flows into countries that had promotion activities in the United States, with the flows into countries that didn't. The study provided some crude support for the idea that promotion worked and, with some assumptions, the costs of attracting an investor, or its trade-off seemed to favor promotion. But more recent data from this survey provided the authors a more sophisticated methodology; as a result, their study is more convincing, and addresses many more questions than earlier work. They find the median expenditure on investment by developing countries to be smaller than expected. However, the study shows that expenditures below a certain annual level yield few, if any returns. Where the investment climate is bad, efforts to improve policy seem sensible; but in fact, in countries with very poor investment climates, returns to expenditures on other promotion activities are likely to be especially low. Similarly, it is likely that promotion has more impact on certain kinds of investors than on others. The research stipulates important factors about organizational issues, and, results show that agencies with some kind of participation from the private sector, do better than those that are purely governmental. It also provides evidence to suggest that, at least for many countries, a dollar spent on investment promotion yields a better return than a dollar provided as a subsidy or given up through a tax incentive program.en
dc.identifierhttp://documents.worldbank.org/curated/en/2003/10/2809356/effectiveness-promotion-agencies-attracting-foreign-direct-investment
dc.identifier.doi10.1596/0-8213-5606-2
dc.identifier.isbn0-8213-5606-2
dc.identifier.urihttps://hdl.handle.net/10986/15073
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.relation.ispartofseriesFIAS Occasional Paper;No. 16
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectINVESTMENT PROMOTION
dc.subjectPROMOTIONAL STRATEGIES
dc.subjectFOREIGN DIRECT INVESTMENTS
dc.subjectINVESTOR CONFIDENCE
dc.subjectBUSINESS ENVIRONMENT
dc.subjectPRIVATE SECTOR PARTICIPATION
dc.subjectCOST-BENEFIT ANALYSIS
dc.subjectSURVEYS
dc.subjectEXPENDITURE PATTERNS
dc.subjectRATE OF RETURN
dc.subjectPOLICY FORMATION
dc.subjectORGANIZATIONAL STRUCTURE
dc.subjectADVERTISEMENTS
dc.subjectBENEFIT ANALYSIS
dc.subjectCHAMBERS OF COMMERCE
dc.subjectCONCEPTUAL FRAMEWORK
dc.subjectCROSS-COUNTRY REGRESSIONS
dc.subjectDOMESTIC INVESTMENT
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMISTS
dc.subjectELASTICITIES
dc.subjectEMPIRICAL ANALYSIS
dc.subjectEXPENDITURES
dc.subjectFDI
dc.subjectFINANCIAL RESOURCES
dc.subjectFOREIGN DIRECT INVESTMENT
dc.subjectFOREIGN INVESTMENT
dc.subjectFOREIGN INVESTOR
dc.subjectFOREIGN INVESTORS
dc.subjectGNP
dc.subjectGROSS NATIONAL PRODUCT
dc.subjectHOST COUNTRY
dc.subjectHOST ECONOMY
dc.subjectINCOME
dc.subjectINCREASING RETURNS
dc.subjectINDUSTRIAL COUNTRIES
dc.subjectINDUSTRIAL DEVELOPMENT
dc.subjectINFLATION
dc.subjectINTERNATIONAL INVESTMENT
dc.subjectINTERNATIONAL STANDARDS
dc.subjectINVESTMENT CLIMATE
dc.subjectINVESTMENT CLIMATES
dc.subjectINVESTMENT DECISIONS
dc.subjectINVESTMENT GUARANTEE AGENCY
dc.subjectINVESTMENT INCENTIVES
dc.subjectINVESTMENT LEADS
dc.subjectINVESTMENT PROMOTION
dc.subjectINVESTMENT PROMOTION AGENCIES
dc.subjectINVESTMENT PROMOTION AGENCY
dc.subjectINVESTMENT SERVICES
dc.subjectIPA
dc.subjectIPAS
dc.subjectLABOR COSTS
dc.subjectLEGAL STATUS
dc.subjectLOCAL FIRMS
dc.subjectLOCAL MARKET
dc.subjectMARKET FAILURE
dc.subjectMARKET SIZE
dc.subjectMEDIA
dc.subjectNATIONAL POLICIES
dc.subjectNATURAL RESOURCES
dc.subjectPOTENTIAL INVESTORS
dc.subjectPRIVATE INVESTMENT
dc.subjectPRIVATE SECTOR
dc.subjectPRIVATE SECTOR INVOLVEMENT
dc.subjectPROFESSIONAL STAFF
dc.subjectPROGRAMS
dc.subjectPUBLIC SECTOR
dc.subjectREGIONAL AGREEMENT
dc.subjectSUBSIDIARY RIGHTS
dc.subjectTAX INCENTIVES
dc.subjectTAXATION
dc.subjectTECHNICAL ASSISTANCE
dc.subjectTECHNOLOGY TRANSFERS
dc.titleThe Effectiveness of Promotion Agencies at Attracting Foreign Direct Investmenten
dspace.entity.typePublication
okr.doctypePublications & Research::Publication
okr.doctypePublications & Research::Publication
okr.docurlhttp://documents.worldbank.org/curated/en/2003/10/2809356/effectiveness-promotion-agencies-attracting-foreign-direct-investment
okr.globalpracticeTransport and ICT
okr.globalpracticeTrade and Competitiveness
okr.guid588311468780303317
okr.identifier.doi10.1596/0-8213-5606-2
okr.identifier.externaldocumentum000012009_20031203122658
okr.identifier.internaldocumentum2809356
okr.identifier.report27150
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2003/12/03/000012009_20031203122658/Rendered/PDF/271500PAPER0Ef1f0promotion0agencies.pdfen
okr.themeFinancial and private sector development :: Other financial and private sector development
okr.topicInternational Economics and Trade::Foreign Direct Investment
okr.topicInternational Economics and Trade::Trade and Regional Integration
okr.topicInternational Terrorism and Counterterrorism
okr.topicEnvironmental Economics and Policies
okr.topicInformation and Communication Technologies::ICT Policy and Strategies
okr.unitFIAS Investment Generation-WB (CICIG)
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