In This Review

Investing in Development: New Roles for Private Capital
Investing in Development: New Roles for Private Capital
By Theodore H. Moran and others
Transaction Books (for the Overseas Development Council), 1986, 194 pp

This excellent and exceptionally timely book raises some cautions about the current mood of "almost unqualified support" for private direct investment as the major solvent of basic international economic problems. Bringing to bear the latest (and usually quite sophisticated) empirical analysis, the authors look at many issues, including the conditions in which foreign investment helps or hurts a host country, the importance of competition, the relation of direct investment to debt, incentives to invest, the "export of jobs," and the role of the World Bank in these processes. The conclusion, according to Professor Moran of Georgetown, is that the "dynamic role" of private direct investment in the growth of developing countries is real, but it "is smaller, takes longer to build up, and carries more dangers than conventional wisdom currently suggests."