Foreign Direct Investment in the Caribbean

This article addresses the question of whether the Caribbean is particularly attractive or unattractive to foreign investors, and if it has specific characteristics that attract or deter FDI. An econometric analysis of data from 135 countries for 1980‐2002 shows that the Caribbean does not suffer from low inflows of FDI; on the contrary, Caribbean countries receive more FDI than comparable countries in other regions. This reflects two contradictory effects. On the one hand, FDI inflows may be particularly sensitive to political instability in the region; on the other hand, the absence of regulation appears to have been a particularly beneficial factor in attracting FDI to the Caribbean.     

The Determinant of Foreign Direct Investment in ASEAN: A Semi-Gravity Approach

This study used a semi gravity model to identify the determinants of FDI in ASEAN countries. The results revealed that besides the market size for host and source country, other criteria such as the shorter the distance, common in language and border, the extended market relative to distance also attracts more foreign investors. Other macroeconomic factors such as lower inflation rate, the slightly higher in exchange rate and good management of the government budget are among the key factors that attract more FDI. In addition to economic factors, social factors such as good telecommunication and infrastructure and non-economic factors such transparency and trade policy also encourage more investors to the ASEAN.     

The Environment for Foreign Direct Investment and the Characteristics of Joint Ventures in China

Since China opened up to the world in 1979, it has tried hard to attract foreign direct investment (FDI) to develop an export-oriented economy. This study assesses the investment climate in China during the period 1979–1990 and analyses the characteristics of joint ventures, which have been the predominant form of FDI in China.     

Foreign Direct Investment and Institutional Environment in Transition Economies

We analysed the relation between foreign direct investment and the quality of the institutional environment in transition economies. The analysis confirmed a significant impact of various institutional aspects on the inflow of foreign capital. To isolate the importance of the institutional environment from the impact of other factors, a panel data analysis was performed using the data of 24 transition economies in the period 1995–2002. The results showed that in the observed period the quality of the institutional environment significantly influenced the level of foreign direct investment in transition economies. Other variables that proved to have a statistically significant influence were budget deficit, insider privatization, and labour cost per hour.     

The Role and Effects of Efficacy in Socioeconomic Development and Foreign Direct Investment: A Comparative Study of South Korea and Singapore

Abstract

There is a sizable amount of research and explanation concerning the rapid and sustainable development of newly industrialised countries (NIC) in Asia. This article seeks to create a deeper understanding of the relationships between the governmental sector, the economic sector, and the social sector in the Asian political arena. As such, it will explain how policies pursued in selected countries could have impacted the economies of the so-called ‘tiger’ or ‘dragon’ countries. In addition, the study will show how governmental efficacy is connected with socioeconomic development by means of comparing, as exemplars, South Korea and Singapore, in the period 1960–2007. The investigated period experienced heightened socioeconomic development in South Korea and Singapore. Stressing the historical evolution of socioeconomic development, the researcher accordingly focused on social, political, and economic outcomes in their relationship with the factor of macroeconomic stability and the varying amounts of foreign direct investment in the two nations. This study looks to create a deeper understanding of the role of government efficacy and socioeconomic development in an Asian context in which government efficacy and political development and institutions have played important roles in creating stable and continuous social and economic development. This idea of government efficacy and political development has helped to strengthen the capacity of governments to adapt and adjust their political agency’s capability to achieve political goals and sustainable socioeconomic development. South Korea has created institutions that are simpler than complex organisations and may lack autonomy and coherence. In contrast, Singapore has created complex and autonomous institutions with strong coherence. The findings in the outcomes section explain the different historical developments of South Korea and Singapore.     

Main Determinants of Foreign Direct Investment in the Southeast European Countries

The growth of foreign direct investments (FDI) in the world has been significant in recent years. Between 1990 and 2000 worldwide FDI inflows increased more than five times, and since 2000 they have declined. During the period of FDI expansion, growth was especially strong from 1997 onward. However, most of the FDI transactions were between the developed countries. The distribution of FDI is unequal and less-developing countries face difficulties in attracting FDI. Despite the fact that FDI is increasingly important to developing countries, over the past few years the share of the developing countries in worldwide FDI inflows has been declining. The paper analyses geographical and sector distribution of FDI in the Southeast European countries (SEEC) and compares its amount with that in Central East European countries. According to economic theory, FDI towards developing countries flows for labor-intensive and low-technology production, while towards developed states, it flows for high-technology production. Identification of determining factors of FDI is a complex problem which depends on several characteristics specific for each country, sectors, and companies. All those factors could be grouped in three broad categories: economic policy of host country, economic performance, and attractiveness of national economy. On the desegregated level, FDI depends on size and growth potential of a national economy, natural resources endowments and quality of workforce, openness to international trade and access to international markets, and quality of physical, financial, and technological infrastructure. An important question is how SEEC can attract more foreign investment. To find the answer, this paper uses data on FDI inflows to SEEC to determine the main host country determinants of FDI and provides regression-based estimation of determinants of FDI. Using a sample of SEEC and panel data techniques, the determinants of FDI in this part of Europe are investigated. The paper researches the relationship between FDI, GDP, GDP per capita, number of inhabitants, trade openness, inflation, external debt, and information and communication technology sectors. For SEEC, FDI inflows are largely dependent on the completion of the privatization process and in this paper we include the level of private sector and privatization as explanatory variables. Our findings suggest that certain variables such as privatization and trade regime, as well as the density of infrastructure, appear to be robust under different specifications. A positive significance of the agglomeration factor is also observed, confirming the relevant theoretical propositions. However, certain differential variables, such as the privatization, could not be fully captured due to the statistical homogeneity of the sample.     

Bilateral Investment Treaties and Foreign Direct Investment: Evidence of Asymmetric Effects on Vertical and Horizontal Investments

Bilateral investment treaties (BITs) are legal instruments used by developing and transition countries to provide investor protection and, by extension, promote higher levels of inward foreign direct investment (FDI). While the link between BITs and FDI has been extensively studied, little is known about the impact of the treaties on different forms of investment. Motivated by this observation, we examine the effects of BITs on vertical and horizontal FDI. We find that BITs are more positively related to vertical than to horizontal FDI. We also find that BITs tend to act as stronger substitutes for better institutions in the case of vertical relative to horizontal investments. The findings inform BIT strategies that are compatible with development objectives in developing and transition countries.     

Policy Reform and Foreign Direct Investment in Africa: Absolute Progress but Relative Decline

Despite improvements in the policy environment, sub‐Saharan Africa's share of foreign direct investment (FDI) in developing countries continues to decline. This article provides an explanation for the deterioration in SSA's FDI global position. It argues that, although SSA has reformed its institutions, improved its infrastructure and liberalised its FDI regulatory framework, the degree of reform has been mediocre compared with the reform implemented in other developing countries. As a consequence, relative to other regions, SSA has become less attractive for FDI. An important implication of these results is that in a competitive global economy, it is not enough just to improve one's policy environment: improvements need to be made both in absolute and relative terms.     

Public Policies,Stakeholder Interest,and Nonprofit Development: The Case of Trade Associations in Shanghai,China

This study examines the reform and development of trade associations in Shanghai, China, one of the main economic hubs of the country and marked by a substantial growth in trade associations since the reform and “opening-up” in 1978. We analyze public policies pertaining to trade associations, survey data collected from 212 local trade associations in Shanghai, and interviews of government officials and trade association leaders. The research results show that trade associations are significantly less dependent on the government and they seem to be more oriented to providing services for and representing corporate members. We trace these changes to public policy reforms and growth in private businesses. The transition reflects the dynamic and changing relationship among the government, trade associations, and business in China. We conclude with a model of these dynamics and a discussion of the implications of this study.     

The Portability of Pension Rights: General Principles and the Caribbean Case

The portability of pension rights is an increasingly important issue in the Caribbean. The large and increasing flows of migrant workers, including both permanent and temporary migrants, the small size of the domestic economies and the process of regional integration and economic openness call for effective means to make pensions portable. This article presents a select survey of the literature on pension portability, and reviews the progress made by the Caribbean countries as well as some remaining challenges in the light of the international experience.     

Economic growth and welfare: How Foreign Direct Investment contributes to improving social order in less developed countries

Abstract

Does Foreign Direct Investment (FDI) promote development? And does it change social order? The attempt to answer these questions will always be controversial, because, first, the effects differ from context to context, and second, it is highly difficult to measure the (positive) spillovers of know-how and technology etc., as well as of contributions to enhancing social responsibility and improving the standards of living in the host country. The outcome will very much depend on how state governments, international bodies, the business world and non-governmental organizations collaborate. Likewise, interdisciplinary collaboration is required to research the issue, between well-trained economists, investment theory specialists, sociologists and ethicists. For this, our article combines a large number of arguments on market and investment theory, business ethics, John H. Dunning’s eclectic paradigm, etc. It examines whether there is practical evidence to support the assumption that doing business through FDI improves social conditions in less developed countries, and whether the logic for this to happen is rooted in ethical theory. The article contributes to insights from the appropriate sub-stream of the development, FDI and poverty/bottom of the pyramid literature, and to highlighting which trends should be followed in academic research. However, there are limitations to the article, which lie with the limitations of ethics frameworks, as these are often only constructed based on certain moral appeal, and only very few of them examine the incentive compatibility of such constructs.     

Cruisin' To Exclusion: Commodity Chains,the Cruise Industry,and Development in the Caribbean

Cruise ship tourism has become one of the fastest growing segments of the global tourism industry and is a central facet of the industry in various regions. This is particularly the case in the Caribbean where at any given time as many as 70 cruise ships may be operating. This article utilizes a global commodity chains (GCC) approach to investigate the political economy of the cruise ship industry and consider the development consequences for the Caribbean. It shows that a small number of global cruise lines use a combination of producer-driven and buyer-driven strategies to maximize on-board revenues and capture a very high proportion of economic surplus. The implications for developing country destinations are disturbingly clear.     

Toward Understanding the Adjustment Problems of Foreign Families in the College Community: The Case of Japanese Wives at the Harvard University Health Services

Abstract

Four hundred fifty-six undergraduates at a Scottish university completed the Core Alcohol and Drug Survey, an instrument widely used in the United States to examine the nature, scope, and consequences of alcohol and other drug use on college campuses. The Scottish students were found to drink more frequently, consume more alcohol, and engage in binge drinking more often than their American counterparts. The Scottish students also demonstrated higher rates of hangovers, missed classes, and blackouts than the Americans, but the percentage of American students who had driven while intoxicated was greater than that of the Scots. Focus groups of students in Scotland and interviews with student affairs personnel and local officials indicated that student drinking is not generally viewed as a problem because extensive alcohol use appears to be part of Scottish culture and is readily accepted. Students reported that their drinking, other than in pubs, was spread out over time and was associated with eating and social activities. At student social events where alcohol was served, there was little evidence of loud, inappropriate, aggressive, or otherwise rowdy behavior; drinking appeared to be handled in a more controlled, safe, and responsible way than among US college students.     

Soft Sovereignty,Rising Powers,and Subnational Foreign Policy-Making: The Case of India

Abstract

The rise of ‘new powers’ in international politics has been frequently associated with a re-emergence of traditional notions of sovereignty as a backlash against the weakening of nation-state sovereignty related to globalization. We argue that the coexistence of these trends has led to new forms of ‘soft sovereignty’. Soft sovereignty means that rising powers both gain and lose authority: From above, their freedom from interference within the international state system is strengthened due to their new status and influence. At the same time, rising powers’ governments are losing authority due to the rise of a multiplicity of sub and transnational actors from below. We apply the concept of soft sovereignty to the analysis of foreign policy-making in India as a least-likely case of a weakening of sovereignty from within a sovereignty-oriented rising power. The analysis of India's relations with Bangladesh and Sri Lanka reveals the huge impact that subnational governments have had on India's policies towards its South Asian neighbours over the past years. The dynamics observed in the case of India reflect many of the traits of current globalization processes, from regionalization to identity politics to the multiplication of actors in the conduct of foreign politics.     

Explaining the Wage Gap: Intra-Industry Trade, Services Linkages and Falling Transportation Costs

In the debate on globalisation and wage inequality within countries, Heckscher–Ohlin theory has featured prominently, yet fails to take into account that globalisation comprises much more than increased trade between advanced and less-advanced countries. This paper develops a framework that takes better heed of the many aspects of globalisation and thereby addresses a new channel through which globalisation might influence wage inequality. Our results indicate that to understand the impact of globalisation on wage inequality, one needs insight in the nature and stage of globalisation and the relative size of a country.     

The Linkages Between FDI and Domestic Investment: Unravelling the Developmental Impact of Foreign Investment in Sub‐Saharan Africa

While the recent increase in foreign direct investment (FDI) to African countries is a welcome development, the impact of these resource inflows on economic development remains in doubt. This article argues that a key channel is its effects on domestic factor markets, especially domestic investment, and analyses the two‐way linkages between FDI and domestic investment in sub‐Saharan Africa. The results suggest, first, that FDI crowds in domestic investment and, secondly, that private investment is a driver of FDI, implying that African countries will gain much from improving the domestic climate. Moreover, there are alternatives to resource endowments as a means of attracting foreign investment to non‐resource‐rich countries.     

Migrant Children,Social Capital and Access to Services Post‐Migration: Transitions,Negotiations and Complex Agencies

For migrant children, moving to a new country is marked by excitement, anxiety and practical challenges in managing this significant transition. This paper draws upon the concepts of social capital and social networks to examine migrant children's access to services post‐migration. Using data from a qualitative study with Eastern European families in Scotland, we identify a range of cumulative barriers that limit children's access to services and illustrate how their experiences are shaped by ethnicity, social class and place. The study shows that migrant children are often disadvantaged post‐migration and develop their own mechanisms to mitigate the impact of migration on their lives. We argue that migrant children's own social networks are relevant and they need to be analysed through a more individualised approach.