This paper examines the interplay between exchange rate regimes and policies and commercial policy in six transition economies. In all these economies the rate of protection afforded domestic industry by the exchange rate has been eroded by high rates of inflation and insufficient growth in...

We model the relationship between foreign direct investment (FDI) and the level of corruption in multinational firms' (MCNs') home and host countries. There are two effects of corruption. The first is that host-country corruption reduces FDI by increasing foreign firms' costs. The second effect,...

We examine the role of FDI in facilitating money laundering and illegal capital flight, focusing on transition economies’ FDI outflows because they largely reflect current investment decisions rather than the inertia of past decisions. We estimate a model of FDI outflows in which illicit money...

We analyse the effect of corruption on FDI. Using FDI outflows from a sample of East European transition economies that had virtually no outward FDI before 1995, we observe FDI flows based mainly on current investment decisions and less on the inertia of past investments. Our model separates the...

We examine the role of FDI in facilitating money laundering and illegal capital flight, focusing on transition economies’ FDI outflows because they largely reflect current investment decisions rather than the inertia of past decisions. We estimate a model of FDI outflows in which illicit money...

This paper examines the interplay between exchange rate regimes and policies and commercial policy in six transition economies. In all these economies the rate of protection afforded domestic industry by the exchange rate has been eroded by high rates of inflation and insufficient growth in...