A World of Possibilities: Internationalization for Productive Development

Gustavo Crespi, Eduardo Fernández-Arias and Ernesto Stein
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Eduardo Fernández-Arias: University of California
Ernesto Stein: University of California

Chapter 8 in Rethinking Productive Development, 2014, pp 233-278 from Palgrave Macmillan

Abstract: Abstract Openness and diversification can be beneficial for economic growth (Brainard and Cooper, 1968; Frankel and Romer, 1999).1 Openness to trade can foster growth by making it easier to import goods that embody new technology, by reaping economies of scale, and by facilitating the process commonly known as learning by doing through exporting, among other channels (Harrison and Rodríguez-Clare, 2010). Export diversification, in turn, reduces sensitivity to sector-specific shocks. Furthermore, deeper participation in global value chains (GVCs) facilitates access to international flows of knowledge and technology, and thus increases the potential for learning and productivity improvements in local firms.

Keywords: Foreign Direct Investment; Market Failure; Domestic Firm; Local Firm; Local Supplier (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-137-39399-9_8

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DOI: 10.1057/9781137393999_8

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