Welfare Enhancing Capital Imports

Masao Oda (odams@mta.biglobe.ne.jp), Koji Shimomura and Ryuhei Wakasugi (wakasugi@unii.ac.jp)
Additional contact information
Masao Oda: Ritsumeikan University and University of Shimane

No 641, KIER Working Papers from Kyoto University, Institute of Economic Research

Abstract: This paper provides a model to consider the conditions under which an acceptance of foreign capital is welfare enhancing in a multi-commodity multi-factor framework. Contrary to the pessimistic conventional wisdom of capital imports and welfare, we provide a justification for the acceptance of foreign capital and the diversification of industrial structure in developing countries. A sufficient condition for the acceptance of foreign capital to be welfare enhancing is that all domestic factors move into the new export sector in equal proportion to the endowments of factors.

Keywords: foreign capital; export sector; tariff revenue; welfare (search for similar items in EconPapers)
JEL-codes: F11 F21 (search for similar items in EconPapers)
Pages: 21pages
Date: 2007-10
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.kier.kyoto-u.ac.jp/DP/DP641.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kyo:wpaper:641

Access Statistics for this paper

More papers in KIER Working Papers from Kyoto University, Institute of Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Makoto Watanabe (watanabe.makoto.2d@kyoto-u.ac.jp).