© 1999

Foreign Capital in Developing Economies

Perspectives from the Theory of Economic Growth


Table of contents

  1. Front Matter
    Pages i-xviii
  2. Historical Perspective

  3. Theoretical Models

    1. Front Matter
      Pages 31-31
    2. Stefano Manzocchi
      Pages 54-76
  4. Empirical Studies

  5. Back Matter
    Pages 179-199

About this book


The object of this volume is to evaluate the pattern and the function of foreign capital in developing countries in a long-run perspective. The main conceptual instruments employed are the theory of economic growth, and the techniques associated with recent advances in growth econometrics. This empirical work points out that there is no mechanical trade-off between the short-term dangers and the long-run gains from capital market integration, but the growth benefits of foreign capital in transforming economies are conditional on an effective destination of the resources. Over-borrowing and excessive consumption are the main pitfalls in the short- as in the long-run. Nevertheless, foreign capital can be conducive to faster growth and possibly higher welfare.


Developing Countries Developing Economies Eastern Europe econometrics economic growth growth growth theory Stagnation

Authors and affiliations

  1. 1.University of PerugiaItaly

About the authors

STEFANO MANZOCCHI is Associate Professor of Economics, University of Perugia. He has been a Visiting Scholar, Research Department, International Monetary Fund, Washington, DC, 1996; a consultant for the European Union and for the Research Centre on the Italian and European Economy. He has published on capital flows and external finance in a range of major economic journals.

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