Controlled openness and foreign direct investment

Joshua Aizenman, Sang Seung Yi

Research output: Contribution to journalArticlepeer-review

5 Scopus citations


The paper investigates why a developing country may adopt a partial reform. A country is considered where the ruling elite (referred to as state capital) prevents the entry of foreign capital, and taxes the private sector before reform. A higher productivity of foreign capital always increases the attractiveness of a partial reform under which state capital can control the inflow of foreign capital, but can reduce the attractiveness of a full reform under which the entry of foreign capital is unregulated. Hence, state capital's control over foreign capital may be a necessary condition for the reform to take place at all.

Original languageEnglish
Pages (from-to)1-10
Number of pages10
JournalReview of Development Economics
Issue number1
StatePublished - 1 Jan 1998
Externally publishedYes

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development


Dive into the research topics of 'Controlled openness and foreign direct investment'. Together they form a unique fingerprint.

Cite this