Corporate transparency , cream-skimming and FDI

  title={Corporate transparency , cream-skimming and FDI},
  author={Assaf Razina and Efraim Sadkaa},
  • Assaf Razina, Efraim Sadkaa
  • Published 2004
RE CT ED P RO O Abstract We develop a simple information-based model of Foreign direct investment (FDI) flows. On the one hand, the relative abundance of ‘‘intangible’’ capital in specialized industries in the source countries, which presumably generates expertise in screening investment projects in the host countries, enhances FDI flows. On the other hand, host-country relative corporate-transparency diminishes the value of this expertise, thereby reducing the flow of FDI. The model also… CONTINUE READING