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Foreign Direct Investment in a Centrally Planned Economy: Lessons from China: Comment on Kamath
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Foreign Direct Investment in a Centrally Planned Economy: Lessons from China: Comment on Kamath
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Journal Article
Foreign Direct Investment in a Centrally Planned Economy: Lessons from China: Comment on Kamath
1994
Overview
Shyam Kamath's (1990) recent study of foreign direct investment (FDI) in China aims to collate recently available data in order to draw lessons for FDI in other centrally planned economies and for the future of China's economic development. The article's conclusions are described as tentative, and they are rather negative - the Chinese FDI policy is unlikely to bear fruit. It is argued that stronger lessons can be drawn from China's experience with FDI, and that this experience has been a positive one. The major criticism of Kamath's article concerns its failure to view the Open Door policy in a more dynamic light. Kamath mentions considerable changes, but presents data mainly on 1979-1983 (and never beyond 1985) and treats this as the single period of the Open Door policy. Observing the evolution of Chinese policy undermines or even reverses many of Kamath's conclusions.
