WHY IS THE BRAZILIAN OUTWARD FOREIGN DIRECT INVESTMENT SO LOW?

Victor Prochnik ()
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Victor Prochnik: Universidade Federal do Rio de Janeiro (UFRJ)

Revista de Economia Mackenzie (REM), 2008, vol. 6, issue 6, 10-40

Abstract: The paper discusses the recent trends in, and outlook for, Brazilian outward foreign direct investment (FDI). It shows that outward FDI from Brazil has de-clined against that from other developing countries and it analyses the pros-pects for recovery. A survey of the international literature reveals that outward FDI benefits both the investing firm and the home country. It is thus relevant to ask why outward FDI by Brazilian firms is so low. In answer, the article surveys the literature on Brazilian outward FDI and presents new evidence in terms of the firm (Brazilian firms are small and they prefer the home market), product (commodities are the main export), technology (low innovation rate), industry (Brazilian firms generally belong to mature or competitive sectors) and the economy (unsuitable financial system and high interest rates).

Keywords: Foreign direct investment; Multinational enterprises; Economic development; Financial system; Determining factors. (search for similar items in EconPapers)
Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:aft:journl:v:6:6:2008:jan:dec:p:10-40

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