International Investment, Political Risk, and Growth

Erscheinungsjahr 2013
ISBN: 978-1-4613-7039-0
Verlag: Springer Nature B.V.

Buch, Englisch, 197 Seiten, Format (B × H): 155 mm x 235 mm, Gewicht: 335 g

Following substantial policy reforms in many countries, the past decade has been characterized by a remarkable increase of long-term private capital flows to the developing world. However, the bulk of these investments has concentrated on a few economies at the intermediate level of the international income distribution, while the large number of low-income countries has been mostly neglected by international investors. Starting from these observations, analyzes the potential growth effects of liberalizing investment regimes in developing economies and offers an explanation for the apparent bias of private capital flows towards middle-income countries. It demonstrates that the removal of investment barriers may liberate an economy from a vicious circle of poverty, unproductive saving, and low growth, and presents a novel approach to analyzing the role of political risk as a major impediment to greater private capital inflows. Offering a combination of theoretical models and empirical analysis, and discussing both the historical evidence and the recent literature, this book contributes to a better understanding of the determinants and consequences of international investment in developing countries.

Zielgruppe

Research

Autoren/Hrsg.

Harms, Philipp

Fachgebiete

• Wirtschaftswissenschaften Volkswirtschaftslehre Volkswirtschaftslehre Allgemein Makroökonomie
• Wirtschaftswissenschaften Volkswirtschaftslehre Internationale Wirtschaft

Inhaltsverzeichnis

1: Introduction.- 1.1 General Motivation and Objectives.- 1.2 Original Contributions.- 1.3 Structure of the Book.- 2: Unstable Growth and International Investment: Empirical Evidence and Literature Survey.- 2.1 “Meltdowns” and “Plains”: The Instability of Developing Countries’ Growth Rates.- 2.2 Theoretical Explanations of Developing Countries’ Growth Performance.- 2.3 International Capital Markets and Growth.- 2.4 Chapter Summary.- Notes.- 3: Stochastic Growth, Poverty Traps, and International Investment.- 3.1 Financial Institutions and Growth.- 3.2 The Closed Economy.- 3.3 The Open Economy.- 3.4 Chapter Summary.- 3.5 Appendices.- Notes.- 4: The Evidence on International Investment and Political Risk.- 4.1 Private Foreign Investment in Developing Countries.- 4.2 Theoretical Puzzles and Solutions.- 4.3 Capital Market Integration and Segmentation.- 4.4 Existing Barriers and Political Risk.- 4.5 Does Political Risk Matter for International Investment? A Literature Survey.- 4.6 Political Risk and Equity Investment - An Empirical Analysis.- 4.7 Chapter Summary.- 4.8 Appendices.- Notes.- 5: The Theoretical Analysis of Political Risk.- 5.1 Traditional Models of Political Risk.- 5.2 Foreign Investment, Host Country Income, and Multiple Equilibria.- 5.3 Distributional Conflict and Investment.- 5.4 Chapter Summary.- Notes.- 6: Host Country Income and the Discrimination of Foreign Investors.- 6.1 Motivation and Central Assumptions.- 6.2 International Diversification and Growth Revisited.- 6.3 The Decision to Discriminate Foreign Investors.- 6.4 Chapter Summary.- 6.5 Appendix: An Alternative Motivation of the Political Support Function.- Notes.- 7: Redistribution in the Closed and the Open Economy.- 7.1 Motivation and Central Assumptions.- 7.2 Redistribution in theClosed Economy.- 7.3 Redistribution and Capital Flight in the Open Economy.- 7.4 Chapter Summary.- 7.5 Appendices.- Notes.- 8: Intragenerational Conflict and Political Risk.- 8.1 Motivation and Central Assumptions.- 8.2 The Policy Decision with Fixed Costs and Heterogeneous Agents.- 8.3 Chapter Summary.- 8.4 Appendix: Proof of Proposition 8.1.- Notes.- 9: Summary and Conclusions.- References.- Author Index.- Symbols and Abbreviations.