Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/4251 
Year of Publication: 
2006
Series/Report no.: 
Proceedings of the German Development Economics Conference, Göttingen 2007 No. 35
Publisher: 
Verein für Socialpolitik, Ausschuss für Entwicklungsländer, Göttingen
Abstract: 
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 simulation results suggest that FDI inflows 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. The Bolivian government may promote growth-enhancing and poverty-alleviating effects of FDI by overcoming labour market segmentation and providing complementary public investment in infrastructure. Yet, simulated policy reforms or alternative productivity scenarios are hardly effective in reducing the divide between urban and rural areas.
Subjects: 
Poverty and income distribution
Bolivia
Computable general equilibrium analysis
Foreign direct investment
JEL: 
O5
C68
D3
F21
Document Type: 
Conference Paper

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