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Foreign Direct Investment (FDI): A means to address food insecurity? A Nexus Analysis

Voss, Ramón LU (2016) SIMV32 20161
Graduate School
Abstract
Food insecurity is a major problem for humanity. Especially in developing
countries, the proportion of people who go to bed hungry is substantial. A basic
reason, among other factors, is the dominant poverty in those regions. Therefore,
many development organizations consider Foreign Direct Investment (FDI) as a
means, which has the potential to regulate these inequalities in developing
countries. FDI in developing countries should be able to close financial gaps and
thus generate economic growth. Economic growth in developing countries is seen
as a key to reduce national poverty and achieve food security. Various
development organizations, researchers and scientists analyze the impact of FDI
on the target economies in order to... (More)
Food insecurity is a major problem for humanity. Especially in developing
countries, the proportion of people who go to bed hungry is substantial. A basic
reason, among other factors, is the dominant poverty in those regions. Therefore,
many development organizations consider Foreign Direct Investment (FDI) as a
means, which has the potential to regulate these inequalities in developing
countries. FDI in developing countries should be able to close financial gaps and
thus generate economic growth. Economic growth in developing countries is seen
as a key to reduce national poverty and achieve food security. Various
development organizations, researchers and scientists analyze the impact of FDI
on the target economies in order to evaluate whether FDI can induce the desired
positive effects.
In this thesis the theoretical framework of Rein and Schön (1996) is used to
examine secondary literature on whether FDI can contribute to food security in
food insecure developing economies. The literature provides theoretical and
empirical examples of how FDI affects the target economy. These results,
however, are not unanimous and lead to different views on FDI in developing
economies. On the one hand it is argued and demonstrated that FDI in developing
countries can contribute to economic growth, which is seen as a prerequisite for
food security. These studies and reports attest FDI as having a positive influence on the target economy. Beyond just financial capital, FDI creates new jobs, enhances human capital, introduces new technologies and contributes to increased production in the target economy which result in economic growth and should enable food insecure developing countries to become food secure. Other
researchers come to different conclusions. According to their theories and
findings, FDI does not necessarily result in positive effects for the developing
target economy. In their perception, foreign investors rather take advantage of
developing countries among others by stealing land from destitute people, paying
low wages or selling produced goods on the global market with low revenue streams for the developing economy. They promulgate that economic growth and
food security in food insecure developing countries cannot be reached through
FDI. In some cases, it evens seems that FDI exacerbates food insecurity. (Less)
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author
Voss, Ramón LU
supervisor
organization
course
SIMV32 20161
year
type
H2 - Master's Degree (Two Years)
subject
keywords
FDI, food security, food insecurity, economic growth, poverty reduction.
language
English
id
8888976
date added to LUP
2016-09-29 15:47:27
date last changed
2016-09-29 15:47:27
@misc{8888976,
  abstract     = {Food insecurity is a major problem for humanity. Especially in developing
countries, the proportion of people who go to bed hungry is substantial. A basic
reason, among other factors, is the dominant poverty in those regions. Therefore,
many development organizations consider Foreign Direct Investment (FDI) as a
means, which has the potential to regulate these inequalities in developing
countries. FDI in developing countries should be able to close financial gaps and
thus generate economic growth. Economic growth in developing countries is seen
as a key to reduce national poverty and achieve food security. Various
development organizations, researchers and scientists analyze the impact of FDI
on the target economies in order to evaluate whether FDI can induce the desired
positive effects.
In this thesis the theoretical framework of Rein and Schön (1996) is used to
examine secondary literature on whether FDI can contribute to food security in
food insecure developing economies. The literature provides theoretical and
empirical examples of how FDI affects the target economy. These results,
however, are not unanimous and lead to different views on FDI in developing
economies. On the one hand it is argued and demonstrated that FDI in developing
countries can contribute to economic growth, which is seen as a prerequisite for
food security. These studies and reports attest FDI as having a positive influence on the target economy. Beyond just financial capital, FDI creates new jobs, enhances human capital, introduces new technologies and contributes to increased production in the target economy which result in economic growth and should enable food insecure developing countries to become food secure. Other
researchers come to different conclusions. According to their theories and
findings, FDI does not necessarily result in positive effects for the developing
target economy. In their perception, foreign investors rather take advantage of
developing countries among others by stealing land from destitute people, paying
low wages or selling produced goods on the global market with low revenue streams for the developing economy. They promulgate that economic growth and
food security in food insecure developing countries cannot be reached through
FDI. In some cases, it evens seems that FDI exacerbates food insecurity.},
  author       = {Voss, Ramón},
  keyword      = {FDI,food security,food insecurity,economic growth,poverty reduction.},
  language     = {eng},
  note         = {Student Paper},
  title        = {Foreign Direct Investment (FDI): A means to address food insecurity? A Nexus Analysis},
  year         = {2016},
}