Mode of foreign entry, technology transfer, and foreign direct investment policy

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Mode of foreign entry, technology transfer, and foreign direct investment policy, Volume 1

Author:	Mattoo, Aaditya; Olarreaga, Marcelo; Saggi, Kamal;	Collection Title:	Policy, Research working paper series ; no. WPS 2737
Date Stored:	2002/01/18	Document Date:	2001/12/31
Document Type:	Policy Research Working Paper	Language:	English
Major Sector:	Public Administration, Law, and Justice	Report Number:	WPS2737
Sub Sectors:	Other Public Sector Management	SubTopics:	Knowledge Economy; Environmental Economics & Policies; Foreign Direct Investment; Agricultural Research; General Technology; Poverty and Trade; Trade and Regional Integration; ICT Policy and Strategies
Volume No:	1

Summary: Foreign direct investment can take place through the direct entry of foreign firms or the acquisition of existing domestic firms. Mattoo, Olarreaga, and Saggi examine the preferences of a foreign firm and the host country government with respect to these two modes of foreign direct investment in the presence of costly technology transfer. The tradeoff between technology transfer and market competition emerges as a key determinant of preferences. The authors identify the circumstances in which the choices of the government and the foreign firm diverge-and in which domestic welfare can be improved by restrictions on foreign direct investment that induce the foreign firm to choose the socially preferred mode of entry.


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File Type		Description	File Size (mb)

	PDF 42 pages	Official version*	2.94 (approx.)
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File Type		Description	File Size (mb)

	PDF 37 pages	WPS2737	0.48

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