There is a growing literature on nonlinear monetary policy in industrialized countries. These investigations have revealed that the reaction of central banks to economic variables depends on the level of such variables, confirming the nonlinearity of policy in the industrialized world....

The opening of low wage nations to FDI has created much more competition for investment since the beginning of the 1990s. Observers in middle-income developing countries such as Brazil, Malaysia and Mexico, which have benefited from FDI, express fears of losing to new, lower wage destinations....