The Impact of Foreign Direct Investment on Developing Countries' Terms of Trade

Konstantin Wacker

No wp-2011-006, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: This paper first shows that important economic arguments in favor of the Prebisch-Singer hypothesis of falling terms of trade of developing countries have implicitly relied on the role of multinational corporations and foreign direct investment. As of yet, the relationship between the latter and terms of trade has not been empirically investigated. In order to start closing this gap in research, data on 111 developing countries between 1980 and 2008 is analyzed using panel data methods.

Keywords: International business enterprises; International trade; Foreign investments; Labour market; Terms of trade (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (6)

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