Two Case Studies: Canada and Puerto Rico

  • H. Peter Gray


No nation or semi-autonomous state has ever found that being geographically situated very close to a much larger and much more powerful state is a comfortable position or an unmixed blessing. The histories of the Austrians, the Finns, the Irish, the Poles and the Vietnamese all testify to the dangers inherent in such a situation. Similarly, in more purely economic terms, metropolises have been able to dominate their hinterlands through the concentration of financial, industrial and market power that the metropolis enjoyed. It is not surprising therefore that when nationality differences and metropolis-hinterland differences reinforce each other, the desirability of the status quo is questioned by the hinterland nation.


Foreign Direct Investment Foreign Investment Foreign Capital Transfer Price Capital Inflow 
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  1. 1.
    One approach which might combine the value-free aspects with the introduction of income distribution into economic analysis is to be found in Abba P. Lerner’s classic work, The Economics of Control (New York: Macmillan and Company, 1944) Ch. 3. Lerner argues there that any movement that makes income distribution more equal has a positive external effect and vice versa.Google Scholar
  2. 2.
    For a succinct discussion of the politico-economic history of Puerto Rico, see Rita M. Maldonado, The Role of the Financial Sector in the Economic Development of Puerto Rico (Washington, D.C.: F.D.I.C., 1970 ) Ch. III.Google Scholar
  3. 1.
    J. Alex Murray, ‘Guidelines for U.S. Investment in Canada’, Columbia Journal of World Business (May Jun 1971 ) pp. 29–37.Google Scholar
  4. 1.
    Hugh G. J. Aitken, American Capital and Canadian Resources ( Cambridge, Mass.: Harvard University Press, 1961 ) pp. 171–2.CrossRefGoogle Scholar
  5. 1.
    See Richard E. Caves, American Industry: Structure, Conduct and Performance 2nd ed. (Englewood Cliffs, N.J.: Prentice-Hall Inc., 1967) Chs. 1 and 2.Google Scholar

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© H. Peter Gray 1972

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  • H. Peter Gray

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