Amerigi, Oscar; Feo, Giuseppe De - Economics Department, University of Strathclyde - 2010
In this paper, we provide an explanation of why privatization may attract foreign investors willing to enter a regional … market. Privatization turns the formerly-public firm into a less aggressive competitor since prot-maximizing output is lower … of an FDI-attracting privatization. On the other hand, it may prevent a welfare-reducing investment by the foreign firm …