"Drawing on the World Bank Investment Climate Assessment surveys, this paper investigates the relationship between firm-level technical efficiency and the investment climate for 22 developing economies and eight manufacturing industries. The authors first propose three measures of firms'...

In the 1990s, foreign direct investment began to swamp all other cross-border capital flows into developing countries. Does foreign direct investment support sound development? In particular, does it contribute to poverty reduction?

Private portfolio flows to a country tend to rise in response to an increase in the current account deficit, a rise in foreign direct investment flows, higher per capita income, and growth performance. The most important determinant of official lending to a developing country seems to be the...