How to Maximize the Domestic Development Orientation of Foreign Direct Investment

Joshua Yindenaba Abor () and Isaac Kofi Bekoe
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Joshua Yindenaba Abor: University of Ghana Business School
Isaac Kofi Bekoe: University of Waterloo

Chapter Chapter 11 in The Palgrave Handbook of Development Finance, 2025, pp 217-238 from Springer

Abstract: Abstract Foreign direct investment (FDI) is recognized to play an important role and contributes significantly to the economic growth of many countries. This chapter offers a comprehensive examination of FDI trends, determinants, benefits, and strategies to maximize its positive impact. It delves into the dynamic nature of global economic activities, highlighting the shifting patterns in FDI outflows and inflows across regions. The determinants of FDI, ranging from macroeconomic factors to regulatory environments, are thoroughly analyzed, accompanied by empirical evidence showcasing diverse contextual influences. The chapter emphasizes the multifaceted benefits of FDI for developing countries, including economic growth, technological advancement, and skill development. However, it also scrutinizes potential drawbacks, such as asymmetric information problems and environmental concerns. The discussion culminates in a strategic framework outlining specific actions for host countries to maximize the domestic development orientation of FDI. Overall, the chapter provides valuable insights for policymakers, investors, and scholars navigating the complex landscape of international investments.

Keywords: Foreign direct investment; Domestic market; Development (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-77422-5_11

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DOI: 10.1007/978-3-031-77422-5_11

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