The benefits and costs of private investment from abroad: a theoretical approach

  • Donald MacDougall


The benefits and costs of private investment from abroad are a matter of considerable importance for Australia. This paper suggests one possible method of analysing some general aspects of the problem. It is mainly theoretical and does not attempt to reach clear-cut practical conclusions. This would require much more factual analysis and consideration of many other aspects. Some of these were discussed by Professor Arndt in ‘Overseas Borrowing — the New Model’ (Economic Record, August 1957), an article which also deals with many of the points analysed below.


Capital Stock Foreign Investment Foreign Firm Marginal Product Private Investment 
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  1. 25.
    The balancing item is excluded; see R. J. Cameron, Economic Record, August 1957, pp. 263–4.Google Scholar
  2. 26.
    Cf. H. W. Arndt and D. R. Sherk, ‘Export Franchises of Australian Companies with Overseas Affiliations’, Economic Record, August 1959.Google Scholar

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© Sir Donald MacDougall 1975

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  • Donald MacDougall

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