Direct and Financial Foreign Investment: How Do They Differ in Benefits to Developing Countries?
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چکیده
Do developing countries derive benefits from foreign financial investment (FFI) in the same way as they do from FDI? Through analyses in a stylized framework of foreign investment, this paper concludes that due to the lack of well functioning financial markets and the lack of technology, FFI flows may not be allocated and utilized as efficiently in developing countries as FDI. The frequently claimed benefits of FFI cannot be substantiated.
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