Government Policies for Inward Foreign Direct Investment in Developing Countries

Abstract

particularly examined the three-way interaction between the host country's incentives to attract FDI and its policies affecting MNEs, its educational and training system, and the MNEs education and training activities.The general conclusion that can be drawn from these papers is that MNEs can and do generate substantial human capital spillovers in developing countries and that appropriate policies can maximise these.For instance, training policies are essential to creating positive synergies with MNEs but must be seen as not FDI-specific -they are necessary for the competitiveness of all enterprises.At this point very little is known about the training activities that MNEs are actually engaged in, and to what extent local employees and managers of MNEs subsequently work in domestic firms, or start new firms themselves.Further research is needed on the relationship between human capital and FDI, that could be extremely fruitful for both policy makers and MNEs.In particular, we need to know more about the transmission mechanisms and the ways in which policies can support them.These five Technical Papers, each of them written by eminent specialists, provide a sound basis for further work which can enhance development potential in very practical ways.

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