Effects Of FDI On Economic Growth

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Environmental effects
Nigam (2009) argues on the one hand, globalization has resulted in making the man more interested toward its planet in which he is living and its ecology i.e. its environment through the technological advancements. But on the other hand, it is considered that with the growth of Transport has resulted in destruction of Ozone layer and many species on the earth. For the process of economic development, every country has to pass from the dirty stage of industrialization which results in the extraction of poisonous material and harmful wastes that are dangerous for the human’s health. But it is considered that these things are necessary to come along with the developments in living standards of humans. But in spite all these
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On the other hand, Moura and Forte (2010) define that the impacts from FDI has major influence on the host countries’ in efficiency and economic growth through the transfer of new technology and know-how, the formation of human resource, integration in global markets, increase of competition and economic growth aspects.
Furthermore, Mencinger (2003, 2013) states that FDI is also treated as the solution to the economic problems of developing countries. Thus, FDI has been studied extensively in the literature. Bayraktar (2013) argues that different factors are listed as possible determinants of FDI such as labor costs, level of human capital, returns to investment, trade openness, financial openness, the size of countries, natural resources endowment, macroeconomic and political determinants, taxes, as well as investment climate in recipient
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Once individuals are employed by MNE subsidiaries, their human capital may be enhanced further through training and on-the-job learning. Those subsidiaries may also have a positive influence on human capital enhancement in other enterprises with which they develop links, including suppliers. Such enhancement can have further effects as that labour moves to other firms and as some employees become entrepreneurs. Thus, the issue of human capital development is intimately related with other, broader development
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