Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/149135
Authors: 
Mukherjee, Rudrarup
Year of Publication: 
2017
Series/Report no.: 
Economics Discussion Papers 2017-1
Abstract: 
In a small open developing country context, the author considers a three-sector general equilibrium framework and tries to find out the effects of foreign capital inflow on welfare of the country. Comparative-static results show that foreign capital inflow widens the skilled-unskilled wage gap under some reasonable conditions, although it causes an expansion of the foreign enclave and the agricultural sector and contraction of the domestic manufacturing sector. Taking sector specific foreign capital, the author finds that foreign direct investment is beneficial in a small open economy in the absence of tariffs.
Subjects: 
foreign capital
small open economy
welfare
tariff
economic development
JEL: 
D50
D60
F4
F63
O11
Creative Commons License: 
http://creativecommons.org/licenses/by/4.0/
Document Type: 
Working Paper

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