Conclusions and Policy Implications

Abstract

Screening the operations of foreign firms in industrialization is not an easy task. Appraising their costs and benefits is no less difficult. It is thus, not surprising that existing theories do not address their role adequately. Weaknesses arise not only in the interpretation of their potential role, but also in their appraisal methods and on how governments can promote them. This is not to say that existing theories are worthless. Especially enterprise, structural and classical Marxist arguments offer rich postulates of foreign firms’ operations. Given the herculean nature of our task, we only attempted some alternative methods of examining their role. In doing so, we omitted a number of areas; e.g. net factor payments abroad, transfer pricing and savings effect. Given the limited size of our study and conjunctural dissimilarities between economies, imitational efforts should be treated with caution.