Template-type: ReDIF-Paper 1.0
Author-Name: Filippov, Sergey
Author-Email: fillipov@merit.unu.edu
Author-Workplace-Name: UNU-MERIT
Author-Name: Costa, Ionara
Author-Email: costa@merit.unu.edu
Author-Workplace-Name: UNU-MERIT
Title: Redefining Foreign Direct Investment Policy: A Two Dimensional Framework 
Abstract: Many countries in the world have adopted policies to attract foreign 
	 direct investment (FDI), placing the traditional focus on the 
	 maximisation of FDI flows, what can be labeled as a quantitative 
	 approach. Recently it has been argued that the FDI policy should be more 
	 selective, promoting good quality FDI inflows. The "quality" implies a 
	 certain level of technological intensity of activities and functions 
	 encompassed in an investment project, and therefore its potential 
	 impacts on host country's development. Notwithstanding the importance of 
	 this new qualitative approach, a bias towards FDI flows has persisted. 
	 While they have received full attention, foreign-owned affiliates 
	 already established in an economy have been somehow neglected. This 
	 paper seeks to overcome this imbalance and proposes a new approach to 
	 FDI policy that incorporates both dimensions. Our main argument is that 
	 policy aiming to fostering the development and innovativeness of TNC 
	 affiliates can be more effective than the attraction of new affiliates.   
Classification-JEL: F21, F23, O24, O38
Keywords: Foreign Direct Investment, Multinational Enterprises, Foreign Affiliates,
	 Public Policy, FDI
Series: UNU-MERIT Working Papers
Creation-Date: 2007
Number: 2007-029
File-URL: https://unu-merit.nl/publications/wppdf/2007/wp2007-029.pdf
File-Format: application/pdf
File-Size: 275 Kb
Handle: RePEc:unm:unumer:2007029