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The Effect of Foreign Direct Investment (FDI) on Employment and Wages in Developing Countries

Mohd Akhter Ali(1), M. Kamraju(2),


(1) Osmania University
(2) Ministry of Education
Corresponding Author

Abstract


This research paper examines the effect of Foreign Direct Investment (FDI) on employment and wages in developing countries. It analyses empirical evidence and theoretical frameworks to understand the complex relationship between FDI inflows and labor market outcomes. The study explores the positive and negative impacts of FDI on job creation, skill upgrading, wage levels, spillover effects, and sectoral/regional disparities. By considering factors such as labor market flexibility, human capital development, and institutional environment, the paper provides policy implications for attracting FDI and promoting inclusive growth.

Keywords


Developing countries; Employment; Foreign direct investment; Labor market outcomes; Wages

References


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