Empirically, developing countries that rely less on foreign capital tend to grow faster. Discuss in the...

Empirically, developing countries that rely less on foreign capital tend to grow faster. Discuss in the context of the CEEC transition country experience.

Expert Solution

*Central and Eastern European countries (CEEC) were considered underdeveloped states compared to Western European countries, because of the lack of necessary resources and technological levels. Their economic growth was mostly conditioned by foreign investment.

*Transition economies in Central Eastern European countries (CEEC)the notion that FDI can act as a catalyst in their effort to reform their economy and as a result of policy and measures has been put in the place to attract foreign direct investment(FDI) inflows.

*FDI inflows emerges as a crucial factor responsible forfacilitating a successful transition process in CEEC as a verysignificant component contributing to high levels of economic activity. ForeignDirect Investment is essential for transition economies not only because of thetransfer of technology and know-how, but as a source of financing it also helpseconomies to cover the current fiscal deficit, supplementing insufficient domesticresources to invest both ownership change and capital formation.

*The role of FDI as a compound collection of capital stocks, know-how and technology is a growth-enhancing component in Central and Eastern Europe (CEE) countries. FDI reinforces insufficient domestic funds to finance both ownership alteration and capital composition. FDI, as sound long-term capital inflow, may introduce technology, managerial know-how and skills required for restructuring companies. Exports and lagged FDI have a relevant positive impact on the country’ economic growth.

*CEE countries, which are more integrated with the EU economies through trade, are likely to grow faster than other supposedly less-integrated countries. Essentially, CEEC seems to have benefited from increasing trade integration in terms of growth rates. All openness variables are significant and positive in all models estimated.

*influences FDI inflows in the CEE economies, the CEE nations’ FDI assisted-development paths, the role of absorptive capacity in establishing the effect of FDI on productivity growth and FDI impacts in CEE transition countries has yielded fairly consistent findings over the past decade.

*Trade and FDI for the economic growth of CEE nations, the influence of FDI on productivity growth, the features of financial intermediation in the CEE region and the effect of financial and capital limitations on FDI. CEE countries preceding the global financial crisis and the incorporation of the CEE nations into the world economy through trade and capital flows.

*FDI inflows and economic growth in the CEE countries, the drivers of inward FDI to CEE economies, the role of FDI in generating microeconomic performance and the effect of the global economic crisis on CEE nations.

Rahul Sunny answered 2 years ago

True / False and why? More globalized developing countries are growing faster than less globalized developing...

True / False and why? More globalized developing countries are growing faster than less globalized developing countries.

1. Why some countries grow faster that others? 2. Discuss the factors that contribute to economic...

1. Why some countries grow faster that others? 2. Discuss the factors that contribute to economic growth. 3. List and briefly describe the 17 Sustainable Development Goals (SDGs).

1. Why some countries grow faster that others? (Give examples if possible) 2. Discuss the factors...

1. Why some countries grow faster that others? (Give examples if possible) 2. Discuss the factors that contribute to economic growth. (Give examples if possible) 3. List and briefly describe the 17 Sustainable Development Goals (SDGs). (Give examples if possible)

In the real world, countries that have faster money growth over the long run tend to...

In the real world, countries that have faster money growth over the long run tend to have a lower government budget deficits over the long run b higher inflation over the long run c lower inflation over the long run d lower nominal interest rates over the long run

How important is foreign aid for developing countries in relation to their other sources of foreign...

How important is foreign aid for developing countries in relation to their other sources of foreign exchange receipts? What are the potential costs and risk to the recipients and how could they be reduced?

It is found that the real GDP per capita of developing countries grows faster than developed...

It is found that the real GDP per capita of developing countries grows faster than developed countries at the same period. Explain this phenomenon in the light of diminishing returns to capital.

discuss microfinance activities in developing countries

how to increase capital formation in less developed countries

1,Ceteris paribus, which countries would you expect to rely MORE on foreign trade as a percentage...

1,Ceteris paribus, which countries would you expect to rely MORE on foreign trade as a percentage of their economic activity? A larger countries, like the US. B smaller countries, like Sweden 2. An economy’s net exports always equals (choose one or both) A the difference between its saving and its investment B its trade balance 3. An economy’s trade balance always equals (choose one or both) A net capital outflow B net foreign investment

Fact 1: The faster companies can grow their revenues and deploy more capital at attractive rates...

Fact 1: The faster companies can grow their revenues and deploy more capital at attractive rates of return, the more value they create. The combination of growth and return on invested capital (ROIC) drives value and value creation. Question 1: Comprehensively explain, using numerical examples, why companies create value by investing capital, from investors, to generate future cash flow at rate of return exceeding the cost of capital.

Question