Economic and legal status of foreign investments in selected countries of Latin America (prepared by the Secretariat) = Situación jurídica y económica de las inversiones extranjeras en países seleccionados de la América Latina (Informe preparado por la Secretaría)

Incluye Bibliografía

Economic and legal status of foreign investments in selected countries of Latin America: foreign investments in Paraguay

Incluye Bibliografía

Foreign investments in Latin America.

At head of title: Inter-American Economic and Social Council. Organization of American States.

Capital markets and the market structure of foreign investments

Contrary to the long-received theory of FDI, interest rates or rates of return can motivate foreign direct investment (FDI) in concert with the benefits of direct ownership. Thus, access to investor capital and capital markets is a vital component of the multinational’s competitive market structure. Moreover, multinationals can use their superior financial capacity as a competitive advantage in exploiting FDI opportunities in dynamic markets. They can also mitigate higher levels of foreign business risks under dynamic conditions by shifting more financial risk to creditors in the host economy. Furthermore, the investor’s expectation of foreign business risk necessarily commands a risk premium for exposing their equity to foreign market risk. Multinationals can modify the profit maximization strategy of their foreign subsidiaries to maximize growth or profits to generate this risk premium. In this context, we investigate how foreign subsidiaries manage their capital funding, business risk, and profit strategies with a diverse sample of 8,000 matched parents and foreign subsidiary accounts from multiple industries in 38 countries.We find that interest rates, asset prices, and expectations in capital markets have a significant effect on the capital movements of foreign subsidiaries. We also find that foreign subsidiaries mitigate their exposure to foreign business risk by modifying their capital structure and debt maturity. Further, we show how the operating strategy of foreign subsidiaries affects their preference for growth or profit maximization. We further show that superior shareholder value, which is a vital link for access to capital for funding foreign expansion in open market economies, is achieved through maintaining stability in the rate of growth and good asset utilization.

Trojan horses: On the origins of national security concerns over foreign investments in the United States from 1919 to 2008

In this thesis I sought to explain the origins of national security concerns over foreign investments in the United States from 1919 to 2008. I identified and examined 29 cases of national security concerns over foreign investments in the United States during that period, and argued that in order to understand the circumstances under which foreign investments in the United States are perceived to be threats to the U.S. security we must rely on a combination of democratic peace theory and the version of political realism known as power transition theory. Thus, I tested the argument that national security concerns over foreign investments in the United States from 1919 to 2008 resulted from: (1) perceptions of international power transition, (2) perceptions of ideological and institutional differences between the United States and the home country of the investor, (3) perceptions of the strategic importance of the sector where the investment is made, and (4) perceptions of participation or control of the foreign investor by the government of the country of origin. I found that all these hypotheses have some explanatory power.

Tax differentials and inflow of foreign direct investments : evidence from foreign operations of U.S. multinational companies

This paper concerns the measurement of the impact of tax differentials across countries on inflow of Foreign Direct Investment (FDI) by using comprehensive data on the foreign operations of U.S. multinational corporations that has been collected by the Bureau of Economic Analysis (BEA), the U.S. Department of Commerce. In particular, this research focuses on examining: (1) how responsive FDI locations are to tax differentials across countries, (2) how different the tax effect on FDI inflow is between developed and developing countries, and (3) whether investment location decisions have become more or less sensitive to tax differences between countries over time ranging from the late 1990s to the early 2000s. Estimation results suggest that high rates of corporate income taxation are associated with reduced foreign assets of U.S. multinational firms in all industries by decreasing the return to foreign asset investment. Further, foreign assets of U.S. multinationals in all industries have become more responsive to non-income tax differentials across countries than to income tax differences from 1999 to 2004. Empirical estimates also indicate that foreign investment by American firms is associated with higher tax sensitivity more in developed countries than in those that are developing.

The determinants of inward foreign direct investment in business services across European regions

The determinants of inward foreign direct investment in business services across European regions, Regional Studies. The role of forward linkages with manufacturing sectors and other service sectors as attractors of business services foreign direct investment (FDI) is studied at the regional level. Using data on 146 NUTS-2 regions, it is found that regions specialized in those (manufacturing) sectors that are high potential users of business services attract more FDI in the business services than other regions. Results are robust to the inclusion of the traditional determinants of foreign investments at the regional level as well as to controls for spatial dependence. The results suggest that regional policies aimed at attracting foreign investors in the business service industry might prove ineffective in the absence of a pre-existing local intermediate demand

Foreign Direct Investment in Latin America and the Caribbean 2007

Includes bibliography

Foreign Direct Investment in Latin America and the Caribbean 2010

Includes bibliography

Foreign Direct Investment in Latin America and the Caribbean 2011

Includes bibliography

Foreign investment and competitive development in Latin America and the Caribbean

Includes bibliography