Description: Foreign Direct Investment and Poverty Reduction

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Foreign Direct Investment and Poverty Reduction

Foreign direct investment is a key ingredient of successful economic growth and development in developing countries--partly because the very essence of economic development is the rapid and efficient transfer and cross-border adoption of "best...

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Bibliographic Details
Main Authors:	Klein, Michael, Aaron, Carl, Hadjimichael, Bita
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	AIR POLLUTION AIR QUALITY ASSET STRIPPING BUSINESS ENVIRONMENT CAPITAL FLOWS CAPITAL GOODS CHARITABLE CONTRIBUTIONS CITIZENS CIVIL SOCIETY COMPETITIVE MARKETS CORPORATE GOVERNANCE CORPORATE RESPONSIBILITY CORRUPT PRACTICES CORRUPTION COST OF CAPITAL CRISES DEBT DEBT RELIEF DEVELOPED COUNTRIES DEVELOPING COUNTRIES DIVIDENDS DIVISION OF LABOR DOMESTIC COMPANIES DOMESTIC ECONOMY DOMESTIC FIRMS DOMESTIC INVESTORS ECONOMIC ANALYSIS ECONOMIC DEVELOPMENT ECONOMIC GROWTH EMPLOYMENT EQUITY FLOWS EXPLOITATION EXPROPRIATION FDI FINANCIAL CRISES FINANCIAL FLOWS FIRM SIZE FOREIGN FOREIGN COMPANIES FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN OWNERSHIP FOREIGN- OWNED FIRMS GLOBAL DEVELOPMENT FINANCE GROWTH RATES HOST COUNTRY HOST ECONOMY HUMAN CAPITAL IMPORTS INCOME INCOME COUNTRIES INCOME DISTRIBUTION INCOME GROWTH INCOME INEQUALITY INSURANCE INTERNATIONAL DEVELOPMENT INTERNATIONAL FINANCIAL INTERNATIONAL STANDARDS INVESTMENT DECISIONS INVESTORS LABOR FORCE MARKET POWER MARKET SIZE MATERIAL WELL-BEING MEDIUM-SIZED FIRMS NATIONAL LEVEL NATURAL RESOURCES OIL PER CAPITA INCOME POLICY ENVIRONMENT POLICY RESEARCH POLLUTERS POLLUTION CONTROL POOR COUNTRIES PORTFOLIO POVERTY ERADICATION POVERTY REDUCTION PRIVATE COMPANIES PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRODUCTIVITY PROFITABILITY PROPERTY RIGHTS RULE OF LAW SAFETY NET SAFETY NETS SANCTIONS SERVICE DELIVERY SERVICE PROVISION SHAREHOLDINGS SKILLED WORKERS SMALL FIRMS SOCIAL SERVICES TAX BASE TAX INCENTIVES TAX REVENUE TECHNICAL ASSISTANCE TRANSITION ECONOMIES TRANSPARENCY URBAN AIR POLLUTION VESTED INTERESTS WAGES WATER SUPPLY
Online Access:	http://documents.worldbank.org/curated/en/2001/06/1346346/foreign-direct-investment-poverty-reduction http://hdl.handle.net/10986/19600

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Summary:	Foreign direct investment is a key ingredient of successful economic growth and development in developing countries--partly because the very essence of economic development is the rapid and efficient transfer and cross-border adoption of "best practices." Foreign direct investment is especially well suited to effecting this transfer and translating it into broad-based growth, not least by upgrading human capital. Growth is the single most important factor in poverty reduction, so foreign direct investment is also central to achieving that important World Bank goal. Government-led programs that improve social safety nets and explicitly redistribute assets and income might direct more of the fruits of growth to the poor. But these are complements--not alternatives--to sensible growth-oriented policies. And growth is needed to fund these government-led programs. Moreover, the delivery of social services to the poor--from insurance schemes to such basic services as water and energy--can clearly benefit from reliance on foreign investors. In short, foreign direct investment remains one of the most effective tools in the fight against poverty.