Investment Decisions in strongUnderdevelopedstrong Countries.pdfVIP

This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: Capital Formation and Economic Growth Volume Author/Editor: Universities-National Bureau Volume Publisher: Princeton University Press Volume ISBN: 0-87014-197-X Volume URL: /books/univ55-2 Publication Date: 1955 Chapter Title: Investment Decisions in Underdeveloped Countries Chapter Author: Henry C. Aubrey Chapter URL: /chapters/c1309 Chapter pages in book: (p. 395 - 438) INVESTMENT DECISIONS IN UNDERDEVELOIED COUNTRIES HENRY G. AUBREY FEDERAL RESERVE BANK OF NEW YORK 1. Introduction Just as peoples outlook may affect their economy, so the nature of their economy influences their outlook.—Re- port on Cuba, Johns Hopkins Press for International Bank for Reconstruction - and Development, 1951. SCOPE OF THE STUDY This paper is chiefly concerned with the economic, organizational, and institutional determinants of investment decisions in under- developed countries. Although the social and cultural determinants are discussed by another contributor, it will not be possible to main- tain this distinction. To do so might even appear, at first sight, un- desirable to those who favor a unified approach to problems of economic development. A sense of past neglect seems to impel econ- omists to give, at present, more weight to noneconomic factors. This tendency, however laudable and indeed inevitable, threatens to lead to disregard of the economists own field of investigation. Factors of undisputed importance, like the presence of traditional preferences or the absence of change-producing tendencies,