FDI Flows in Developed and Developing Economies : A Trend Analysis (INDIA VS USA)

With the development of the world economy, FDI plays an important role. The FDI hence provides an opportunity to grow as it multiple investments from limited domestic to an international market. But as an investment is done to gain more returns, the developed countries have attracted more than developing countries. The reason can be that the developed countries utilize financial resources more effectively and efficiently than developing countries. Observing the data given by, this paper deals with the trend analysis of FDI inflows and outflows from developed and developing economies and focusing the reasons why the developed countries have a major share in FDI inflows and outflows for over four decades (i.e. 1970-2012) and to know why developing countries geared up there FDI flows after 1990 and faced fall in the early 2000s. The trend analysis is supported by the deep literature review of papers related to FDI and external factors that affected the FDI flows in the world. The paper is summed up with the reasons for the FDI trend in developed and developing economies. For this, we need to compare two nations one a developed and another developing nation and hence we took the USA and India