Chap012

Chap012 - Chapter 12 International Factor Movements CHAPTER...

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Chapter 12 – International Factor Movements CHAPTER 12 INTERNATIONAL FACTOR MOVEMENTS Learning Objectives: To learn about the different types of foreign investment and the welfare effects of capital movements. To understand the determinants of foreign direct investment and the associated costs and benefits. To grasp the motivation for labor migration and its effects on participating countries. To appreciate the size and importance of international remittances. I. Outline Introduction International Capital Movements through Foreign Direct Investment and Multinational Corporations - Foreign Investors in China: “Good” or “Bad” from the Chinese Perspective? - Definitions - Some Data on Foreign Direct Investment and Multinational Corporations - Reasons for International Movement of Capital - Analytical Effects of International Capital Movements - Potential Benefits and Costs of Foreign Direct Investment to a Host Country Labor Movements Between Countries - Seasonal Workers in Germany - Permanent Migration: A Greek in Germany - Economic Effects of Labor Movements - Additional Considerations Pertaining to International Migration - Immigration and the United States – Recent Perspectives Summary II. Special Chapter Features In The Real World: Determinants of Foreign Direct Investment In The Real World: Host-Country Determinants of Foreign Direct Investment Inflows In The Real World: Immigrant Remittances In The Real World: Immigration into the United States and Canada In The Real World: Is There a Licensing Bias against Foreign Medical Graduates? In The Real World: Immigration into the United States and the “Brain Drain” from Developing Countries 12-1
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Chapter 12 – International Factor Movements III. Purpose of Chapter In the theoretical analysis to this point it has been assumed that factors are immobile between countries. Because this is clearly not the case, the purpose of this chapter is to examine the reasons for and the trade and income implications of movements of capital and labor between countries. IV. Teaching Tips A. With the current attention being paid to foreign investment and migrant workers, students should find the issues covered in this chapter contemporary and interesting. The discussion of the impact of foreign direct investment in China may be of particular interest. The Chinese case is controversial in the United States and many other countries that trade with China, and it serves as a very intriguing case study for this class. We want students to see the real-world application of these issues before they move into the graphical analysis of capital and labor movements. B. It is important to make certain that the students understand the capital market equilibrium concept that is developed early in the chapter and presented graphically in Figure 1. Once the analytics have been grasped, then summarizing the overall costs and benefits of foreign investment logically follows. C.
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Chap012 - Chapter 12 International Factor Movements CHAPTER...

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