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Distributional effects of FDI: How the interaction of FDI and economic policy affects poor households in Bolivia

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dc.creator Nunnenkamp, Peter
dc.creator Schweickert, Rainer
dc.creator Wiebelt, Manfred
dc.date 2006
dc.date.accessioned 2013-10-16T06:25:10Z
dc.date.available 2013-10-16T06:25:10Z
dc.date.issued 2013-10-16
dc.identifier http://hdl.handle.net/10419/3833
dc.identifier ppn:513846360
dc.identifier.uri http://koha.mediu.edu.my:8181/xmlui/handle/10419/3833
dc.description This paper provides a computable general equilibrium analysis of the medium to long-run impact of FDI inflows on poverty and income distribution in Bolivia. The CGE analysis addresses several important transmission channels which have been neglected in the empirical literature by (i) investigating the impact of FDI inflows on incomes of urban and rural households; (ii) taking into account informal activities; and (iii) differentiating between various segments of the urban workforce, whereas previous studies are typically confined to the dichotomy between white-collar and blue-collar workers in manufacturing industries. The simulation results suggest that FDI inflows add to Bolivia?s investment ratio, enhance economic growth, and reduce poverty. However, the income distribution typically becomes more unequal. In particular, FDI widens income disparities between urban and rural areas Our results point to two levers through which the Bolivian government may promote growth-enhancing and poverty-alleviating effects of FDI. First, it seems important to overcome labor market segmentation. Second, complementary public investment in infrastructure may help remove bottlenecks in the absorptive capacity of the economy that tend to limit productive employment of the poor. Yet, simulated policy reforms or alternative productivity scenarios are hardly effective in reducing the divide between urban and rural areas.
dc.language eng
dc.publisher Kiel Institute for the World Economy (IfW) Kiel
dc.relation Kieler Arbeitspapiere 1281
dc.rights http://www.econstor.eu/dspace/Nutzungsbedingungen
dc.subject D3
dc.subject F21
dc.subject C68
dc.subject O5
dc.subject ddc:330
dc.subject Foreign direct investment
dc.subject Poverty and income distribution
dc.subject Bolivia
dc.subject Computable general equilibrium analysis
dc.subject Direktinvestition
dc.subject Wirtschaftspolitische Wirkungsanalyse
dc.subject Armut
dc.subject Einkommensverteilung
dc.subject Stadt-Land-Beziehung
dc.subject Allgemeines Gleichgewicht
dc.subject Schätzung
dc.subject Bolivien
dc.title Distributional effects of FDI: How the interaction of FDI and economic policy affects poor households in Bolivia
dc.type doc-type:workingPaper


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