BUSINESS INFORM JOURNAL.

УКР

ENG

Search:

REGISTRATION CERTIFICATE

KV #19905-9705 PR dated 02.04.2013.

FOUNDERS

RESEARCH CENTRE FOR INDUSTRIAL DEVELOPMENT PROBLEMS of NAS (KHARKIV, UKRAINE)

According to the decision No. 802 of the National Council of Television and Radio Broadcasting of Ukraine dated 14.03.2024, is registered as a subject in the field of print media.
ID R30-03156

PUBLISHER

Liburkina L. M.

SITE SECTIONS

The Impact of Foreign Direct Investment on Less Developed Regions
Lazarenko M. I.

Lazarenko, Maksym I. (2024) “The Impact of Foreign Direct Investment on Less Developed Regions.” Business Inform 2:56–62.
https://doi.org/10.32983/2222-4459-2024-2-56-62

Section: Investment Processes

Article is written in Ukrainian
Downloads/views: 0

Download article (pdf) -

UDC 330.3:332.1

Abstract:
The article is devoted to the study of the impact of foreign direct investment (FDI) and the activities of TNCs in less developed regions (LDRs), which can lead to a break in value chains and to an increasingly complex division of labor, more complex decisions on location and directions of regional development. The author presents different types and mechanisms of FDI in more developed regions (MDRs) and in LDRs. The main approaches to FDI in the LDRs, developed in economic theory, are evaluated. Attention is drawn to that that international production and FDI will have significant implications for the LDRs in the near future. The development of factory automation is likely to reduce the feasibility of low labor costs, low-cost locations, which, in turn, will lead to increased reuse, attraction of resources in high-tech industries and a decrease in the level of added value of services. Increasing digitalization of supply chains is likely to lead to the emergence of more complex global production networks, the expansion of international production in both low-tech industries and higher value-added services. Increased automation and digitalization, trends in regional integration towards more stable local and regional sources of supply, and a push to become less dependent on imports of strategic goods undertaken by more developed regions (MDRs) are likely to lead to stronger organization of production networks on a macro-regional scale. The article urges experts to continue researching FDI in the face of uneven development.

Keywords: foreign direct investment, FDI side effects, transnational corporations, global production networks, international division of labor, regional development.

Bibl.: 13.

Lazarenko Maksym I. – Postgraduate Student, Department of Economic Theory and Economic Management Methods, V. N. Karazin Kharkiv National University (4 Svobody Square, Kharkіv, 61022, Ukraine)
Email: [email protected]

List of references in article

“World investment report 2020: International production beyond the pandemic“. UNCTAD. 2020. https://unctad.org/system/files/official-document/wir2020_en.pdf
“World investment report 2021: Investing in sustainable recovery“. UNCTAD. 2021. https://unctad.org/system/files/official-document/wir2021_en.pdf
Spencer, J. W. “The Impact of Multinational Enterprise Strategy on Indigenous Enterprises: Horizontal Spillovers and Crowding Out in Developing Countries“. Advances in Magnetic Resonance, vol. 33, no. 2 (2008): 341-361. DOI: https://doi.org/10.5465/amr.2008.31193230
Markovych, V. V. “Metodychni pidkhody do doslidzhennia sotsialno-ekonomichnoi efektyvnosti transkordonnoho spivrobitnytstva“ [Methodological Approaches to the Study of Social and Economic Efficiency of Cross-border Cooperation]. Rehionalna ekonomika. 2015. http://re.gov.ua/re201501/re201501_136_MarkovychVV.pdf
Akyuz, Y. Playing with Fire: Deepened Financial Integration and Changing Vulnerabilities of the Global South. Oxford University Press, 2017.
Hallin, Ch., and Holmstrom, Lind Ch. “Revisiting the external impact of MNCs: An empirical study of the mechanisms behind knowledge spillovers from MNC subsidiaries“. International Business Review, vol. 21, no. 2 (2012): 167-179. DOI: https://doi.org/10.1016/j.ibusrev.2010.12.003
Gorg, H., and Strobl, E. “Spillovers from Foreign Firms through Worker Mobility: An Empirical Investigation“. The Scandinavian Journal of Economics, vol. 107, no. 4 (2005): 693-709. DOI: https://doi.org/10.1111/j.1467-9442.2005.00427.x
Perrons, D. C. “The role of Ireland in the new international division of labour: A proposed framework for regional analysis“. Regional Studies, vol. 15, no. 2 (1981): 81-100. DOI: https://doi.org/10.1080/09595238100185111
Massey, D. Spatial divisions of labour: Social structures and the geography of production. Macmillan, 1995.
Saveliev, Ye. “«Novyi rehionalizm» i rozvytok teoretychnykh aspektiv klasteroutvorennia“ ["New Regionalism" and the Development of Theoretical Aspects of Cluster Formation]. Visnyk ekonomichnoi nauky Ukrainy. 2013. http://dspace.nbuv.gov.ua/bitstream/handle/123456789/93133/34-Savelyev.pdf?sequence=1
Zhan, J. X. “GVC transformation and a new investment landscape in the 2020s: Driving forces, directions, and a forward-looking research and policy agenda“. Journal of International Business Policy, vol. 4, no. 2 (2021): 206-220. DOI: https://doi.org/10.1057/s42214-020-00088-0
Kleibert, J. M. “Global production networks, offshore services and the branch-plant syndrome“. Regional Studies, vol. 50, no. 12 (2016): 1995-2009. DOI: https://doi.org/10.1080/00343404.2015.1034671
Dawley, S., MacKinnon, D., and Pollock, R. “Creating strategic couplings in global production networks: Regional institutions and lead firm investment in the Humber region, UK“. Journal of Economic Geography, vol. 19, no. 4 (2019): 853-872. DOI: https://doi.org/10.1093/jeg/lbz004

FOR AUTHORS

License Contract

Conditions of Publication

Article Requirements

Regulations on Peer-Reviewing

Publication Contract

Current Issue

Frequently asked questions

INFORMATION

The Plan of Scientific Conferences

OUR PARTNERS

Journal «The Problems of Economy»

The site and its metadata are licensed under CC BY-SA.

Write to webmaster