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Some studies are skeptical whether further investment is productive and trade liberalization is promising for SSA economic growth. However, the skepticisms are mostly reliant on single equation estimations of contemporaneous effects that may not account for simultaneity and dynamic interactions....
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We investigate empirically the existence of a heterogeneous relation between foreign direct investment (FDI) and … correlated with heterogeneous absorptive capacities and hence a heterogeneous FDI-growth relation. Our empirical results show … substantial heterogeneity in the FDI-growth relation. We find that controlling for certain measures of institutional quality …
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This paper studies theoretically how the cross-country differences in the institutional quality (IQ) of the domestic credit markets shape the patterns of international capital flows when such IQ differences cause productivity differences across countries. IQ affects productivity by changing...
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