foreign direct investment and capital flight.pdf

PRINCETON STUDIES IN INTERNATIONAL FINANCE No. 80, March 1996 FOREIGN DIRECT INVESTMENT AND CAPITAL FLIGHT CHANDER KANT INTERNATIONAL FINANCE SECTION DEPARTMENT OF ECONOMICS PRINCETON UNIVERSITY PRINCETON, NEW JERSEY PRINCETON STUDIES IN INTERNATIONAL FINANCE PRINCETON STUDIES IN INTERNATIONAL FINANCE are published by the International Finance Section of the Department of Economics of Princeton University. Al- though the Section sponsors the Studies, the authors are free to develop their topics as they wish. The Section welcomes the submission of manuscripts for publication in this and its other series. Please see the Notice to Contributors at the back of this Study. The author of this Study, Chander Kant, is Associate Professor of Economics in the W. Paul Stillman School of Business at Seton Hall University and was previously a consultant with the International Finance Corporation in Washington, D.C. A substantial part of the work for this Study was completed while Professor Kant was at the IFC. His earlier work on the subject of foreign direct invest- ment also includes discussions of the real and fiscal effects of internal transactions by multinational corporations. PETER B. KENEN, Director International Finance Section PRINCETON STUDIES IN INTERNATIONAL FINANCE No. 80, March 1996 FOREIGN DIRECT INVESTMENT AND CAPITAL FLIGHT CHANDER KANT INTERNATIONAL FINANCE SECTION