Publication:
Attracting Foreign Direct Investment : What Can South Asia's Lack of Success Teach Other Developing Countries?

Simple item page
dc.contributor.authorGould, David M.
dc.contributor.authorTan, Congyan
dc.contributor.authorSadeghi Emamgholi, Amir S.
dc.date.accessioned2014-02-05T14:53:55Z
dc.date.available2014-02-05T14:53:55Z
dc.date.issued2013-11
dc.description.abstractLike many other developing countries, South Asian nations have been experiencing increased foreign direct investment inflows over the past decade as developing countries get a larger share of cross-border investments that were once sent to developed countries. Nonetheless, South Asia's inflows of foreign direct investment remain the lowest relative to gross domestic product among developing country regions. Why are South Asia's foreign direct investment inflows so low and what lessons can be drawn for developing countries as a whole? The analysis in this paper uses a novel empirical model that accounts for possible trends in convergence in the ratio of foreign direct investment to gross domestic product between countries and cross-sectional data for 78 countries from 2000 to 2011. The sample contains 52 developing countries. The analysis finds that two key factors are at work -- high overall regulatory restrictions on foreign direct investment and specific restrictions placed on doing business with other countries. These factors include overall trade restrictiveness, which reduces the benefits to cross-border investments, and weak institutions to protect foreign investors and facilitate investment. Nonetheless, the potential for faster growth in intra- and inter-regional foreign direct investment flows is significant. The main factors leading to this conclusion are South Asia's current low levels of foreign direct investment, the many unexploited opportunities for embodied knowledge transfer, and supply-chain linkages. The overall lessons for developing countries are that liberalizing policy constraints in both trade and foreign investment, keeping corporate tax rates modest, and improving governance and transparency could help to substantially improve foreign direct investment flows.en
dc.identifierhttp://documents.worldbank.org/curated/en/2013/11/18491804/attracting-foreign-direct-investment-can-south-asias-lack-success-teach-other-developing-countries
dc.identifier.doi10.1596/1813-9450-6696
dc.identifier.urihttps://hdl.handle.net/10986/16918
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 6696
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectADVANCED ECONOMIES
dc.subjectAVERAGING
dc.subjectBALANCE OF PAYMENTS
dc.subjectBANK LENDING
dc.subjectBARRIERS
dc.subjectBOND
dc.subjectBUDGETS
dc.subjectBUSINESS CYCLE
dc.subjectBUSINESS ENVIRONMENTS
dc.subjectCAPITAL ACCOUNT
dc.subjectCAPITAL ACCOUNT RESTRICTIONS
dc.subjectCAPITAL FLOW
dc.subjectCAPITAL FLOWS
dc.subjectCAPITAL FORMATION
dc.subjectCAPITAL GROWTH
dc.subjectCAPITAL MARKETS
dc.subjectCAPITAL OUTFLOWS
dc.subjectCOMMUNICATION
dc.subjectCOMPETITION
dc.subjectCOMPETITIVE MARKETS
dc.subjectCORPORATE TAX
dc.subjectCORPORATE TAX RATES
dc.subjectCORPORATE TAXES
dc.subjectCROSS-BORDER CAPITAL
dc.subjectDATA AVAILABILITY
dc.subjectDEBT
dc.subjectDEBT LEVELS
dc.subjectDECLINE IN INVESTMENT
dc.subjectDEVELOPING COUNTRIES
dc.subjectDEVELOPING COUNTRY
dc.subjectDEVELOPING COUNTRY INVESTMENTS
dc.subjectDEVELOPING ECONOMIES
dc.subjectDEVELOPING ECONOMY
dc.subjectDEVELOPMENT POLICY
dc.subjectDIRECT FOREIGN INVESTMENT
dc.subjectDIVERSIFIED MARKETS
dc.subjectDOLLAR VALUE
dc.subjectDOMESTIC ECONOMY
dc.subjectDOMESTIC INVESTORS
dc.subjectDOMESTIC MARKET
dc.subjectDUMMY VARIABLE
dc.subjectECONOMIC CRISIS
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC INTEGRATION
dc.subjectECONOMIC POLICIES
dc.subjectECONOMIC STRUCTURE
dc.subjectEMERGING ECONOMIES
dc.subjectEQUITY
dc.subjectEQUITY STAKE
dc.subjectEXCHANGE
dc.subjectEXCHANGE RATES
dc.subjectEXPORTER
dc.subjectEXPORTERS
dc.subjectEXPOSURE
dc.subjectEXTERNAL TRADE
dc.subjectFINANCE
dc.subjectFINANCIAL CRISES
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL DEVELOPMENT
dc.subjectFINANCIAL FLOWS
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectFINANCIAL MARKET
dc.subjectFINANCIAL MARKET DEVELOPMENT
dc.subjectFINANCIAL MARKETS
dc.subjectFINANCIAL SECTOR
dc.subjectFINANCIAL SECTOR DEVELOPMENT
dc.subjectFINANCIAL SYSTEMS
dc.subjectFOREIGN CAPITAL
dc.subjectFOREIGN DIRECT INVESTMENT
dc.subjectFOREIGN EXCHANGE
dc.subjectFOREIGN EXCHANGE TRANSACTIONS
dc.subjectFOREIGN FIRM
dc.subjectFOREIGN FIRMS
dc.subjectFOREIGN INVESTMENT
dc.subjectFOREIGN INVESTMENT FLOWS
dc.subjectFOREIGN INVESTORS
dc.subjectFOREIGN MARKETS
dc.subjectFREE TRADE
dc.subjectFUTURE
dc.subjectFUTURE GROWTH
dc.subjectGDP
dc.subjectGLOBAL BUSINESS
dc.subjectGLOBAL ECONOMY
dc.subjectGLOBAL FINANCIAL MARKETS
dc.subjectGLOBAL MARKETS
dc.subjectGLOBALIZATION
dc.subjectGOOD
dc.subjectGOODS
dc.subjectGOVERNANCE
dc.subjectGOVERNANCE INDICATORS
dc.subjectGROSS DOMESTIC PRODUCT
dc.subjectGROWTH INVESTMENT
dc.subjectGROWTH RATE
dc.subjectGROWTH RATES
dc.subjectGUARANTEE
dc.subjectHOME COUNTRIES
dc.subjectHOST COUNTRIES
dc.subjectHOST COUNTRY
dc.subjectHUMAN CAPITAL
dc.subjectHUMAN RESOURCES
dc.subjectINCENTIVES
dc.subjectINCOME
dc.subjectINFLATION
dc.subjectINFLUENCE
dc.subjectINFORMATION ASYMMETRY
dc.subjectINSTITUTIONAL CAPACITY
dc.subjectINSTITUTIONAL DEVELOPMENT
dc.subjectINTEREST
dc.subjectINTERESTS
dc.subjectINTERNATIONAL BANK
dc.subjectINTERNATIONAL BUSINESS
dc.subjectINTERNATIONAL CAPITAL
dc.subjectINTERNATIONAL CAPITAL FLOWS
dc.subjectINTERNATIONAL ECONOMICS
dc.subjectINTERNATIONAL ECONOMIES
dc.subjectINTERNATIONAL FINANCIAL STATISTICS
dc.subjectINTERNATIONAL INVESTMENT
dc.subjectINTERNATIONAL INVESTORS
dc.subjectINTERNATIONAL TRADE
dc.subjectINVESTING
dc.subjectINVESTMENT DECISIONS
dc.subjectINVESTMENT FLOWS
dc.subjectINVESTMENT POLICIES
dc.subjectINVESTMENT POLICY
dc.subjectINVESTMENT REGIME
dc.subjectINVESTMENTS
dc.subjectINVESTOR
dc.subjectJOINT VENTURES
dc.subjectLABOR MARKET
dc.subjectLIQUIDITY
dc.subjectLIQUIDITY CRISES
dc.subjectLIQUIDITY PROBLEMS
dc.subjectLIVING STANDARDS
dc.subjectLOCAL BUSINESSES
dc.subjectLOCAL CURRENCY
dc.subjectMACROECONOMIC ENVIRONMENT
dc.subjectMACROECONOMIC STABILITY
dc.subjectMACROECONOMIC UNCERTAINTY
dc.subjectMARKET ACCESS
dc.subjectMARKET DEVELOPMENT
dc.subjectMERGERS
dc.subjectMULTINATIONAL CORPORATIONS
dc.subjectNATURAL CAPITAL
dc.subjectNATURAL RESOURCE
dc.subjectNATURAL RESOURCES
dc.subjectNEW PRODUCT
dc.subjectOPTIONS
dc.subjectOUTCOMES
dc.subjectOUTPUT
dc.subjectOUTSOURCING
dc.subjectPARTICULAR COUNTRY
dc.subjectPOLITICAL DETERMINANTS
dc.subjectPOLITICAL ECONOMY
dc.subjectPOLITICAL RISK
dc.subjectPOLITICAL RISKS
dc.subjectPOLITICAL STABILITY
dc.subjectPOLITICAL UNCERTAINTY
dc.subjectPORTFOLIO
dc.subjectPORTFOLIO CAPITAL
dc.subjectPORTFOLIO CAPITAL INFLOWS
dc.subjectPORTFOLIO FLOWS
dc.subjectPORTFOLIO INFLOWS
dc.subjectPORTFOLIO INVESTMENT
dc.subjectPORTFOLIO INVESTMENTS
dc.subjectPOVERTY
dc.subjectPOWER PARITY
dc.subjectPRICES
dc.subjectPRIVATE CAPITAL
dc.subjectPRIVATE CAPITAL FLOWS
dc.subjectPRIVATE CAPITAL INFLOWS
dc.subjectPRIVATE CREDIT
dc.subjectPRIVATE INVESTMENT
dc.subjectPRIVATE SECTOR CREDIT
dc.subjectPRODUCTIVITY
dc.subjectPROFITS
dc.subjectPROPERTY
dc.subjectPUBLIC INVESTMENT
dc.subjectPURCHASING POWER
dc.subjectRAPID GROWTH
dc.subjectRATE OF GROWTH
dc.subjectREAL EXCHANGE RATE
dc.subjectREGISTRATION PROCESSES
dc.subjectREGULATORY ENVIRONMENT
dc.subjectREGULATORY FRAMEWORKS
dc.subjectREGULATORY RESTRICTIONS
dc.subjectRENEWABLE ENERGY
dc.subjectRENEWABLE ENERGY SECTOR
dc.subjectRETURNS
dc.subjectREVENUE
dc.subjectREVENUES
dc.subjectRISK AVERSION
dc.subjectSECURITY
dc.subjectSHARE
dc.subjectSHARES
dc.subjectSTOCK
dc.subjectSTOCKS
dc.subjectSUSTAINABLE DEVELOPMENT
dc.subjectTARIFF
dc.subjectTARIFFS
dc.subjectTAX
dc.subjectTAX RATE
dc.subjectTAXES
dc.subjectTECHNOLOGY TRANSFERS
dc.subjectTOTAL FACTOR PRODUCTIVITY
dc.subjectTOTAL FACTOR PRODUCTIVITY GROWTH
dc.subjectTRADE LIBERALIZATION
dc.subjectTRADE PROTECTION
dc.subjectTRANSACTION
dc.subjectTRANSACTION COSTS
dc.subjectTRANSITION ECONOMIES
dc.subjectTRANSPARENCY
dc.subjectTRENDS
dc.subjectVOLATILITY
dc.subjectWAGE GROWTH
dc.subjectWELFARE
dc.subjectWORLD DEVELOPMENT INDICATORS
dc.subjectWORLD ECONOMY
dc.subjectWORLD INVESTMENT REPORT
dc.titleAttracting Foreign Direct Investment : What Can South Asia's Lack of Success Teach Other Developing Countries?en
dspace.entity.typePublication
okr.crossref.titleAttracting Foreign Direct Investment: What Can South Asia's Lack of Success Teach other Developing Countries?
okr.date.disclosure2013-11-01
okr.date.doiregistration2025-04-10T07:18:07.482155Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2013/11/18491804/attracting-foreign-direct-investment-can-south-asias-lack-success-teach-other-developing-countries
okr.globalpracticeMacroeconomics and Fiscal Management
okr.globalpracticeFinance and Markets
okr.globalpracticeTrade and Competitiveness
okr.guid425891468170975572
okr.identifier.doi10.1596/1813-9450-6696
okr.identifier.externaldocumentum000158349_20131108143026
okr.identifier.internaldocumentum18491804
okr.identifier.reportWPS6696
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2013/11/08/000158349_20131108143026/Rendered/PDF/WPS6696.pdfen
okr.region.administrativeSouth Asia
okr.region.geographicalSouth Asia
okr.topicInternational Economics and Trade::Foreign Direct Investment
okr.topicMacroeconomics and Economic Growth::Investment and Investment Climate
okr.topicEconomic Theory and Research
okr.topicPrivate Sector Development::Emerging Markets
okr.topicFinance and Financial Sector Development::Debt Markets
okr.unitOffice of the Chief Economist Office, South Asia Region
okr.volume1 of 1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
Files
Original bundle
Now showing 1 - 2 of 2
Thumbnail Image
Name:
WPS6696.pdf
Size:
1.28 MB
Format:
Adobe Portable Document Format
Download
No Thumbnail Available
Name:
WPS6696.txt
Size:
145.08 KB
Format:
Plain Text
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
1.71 KB
Format:
Plain Text
Description:
Download
Collections
Policy Research Working Papers