‘Direct’ Balance-of-Payments Effects
where X = f.o.b. value of exports;
I = inflows of equity capital and loans from abroad, including earnings retained out of profits, net of capital and loans repatriated;
C k = c.i.f. value of capital goods imported;
C r = c.i.f. value of raw materials and intermediate goods imported (excluding finished goods imported for resale);
R = royalties and technical fees paid abroad after tax; and
D = net after-tax profits and interest accruing abroad, including retained earnings.
KeywordsHost Country Foreign Firm Parent Company Sample Firm Transfer Price
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