Effects of FDI on Emerging Markets : An exploratory study of nineteen emerging markets and the real effects of inward FDI

The world is globalizing and so are the businesses within. Today a more integrated global economy increases the usage of foreign direct investments to a larger extent than ever before. In recent decades a shift of the perception of foreign direct investments has occurred from being something negative and disadvantageous for the host market to a more positive and advantageous opportunity for emerging markets. Historically, foreign direct investments were seen as capital movement between developed countries to increase market shares, nowadays, foreign direct investments are more focused on emerging markets to manufacture products at a lower cost and exploit the natural resources. The real effects and implications of foreign direct investments for the host country are a contested topic within the research field. Both positive and negative effects can be found in previous research. In this thesis, the focus is on understanding the effects that foreign direct investment has on emerging markets. This is conducted by analyzing relevant statistical data for a 10-year period and compare the findings against the perception of this phenomenon in previous research. The outcome of this study shows both positive and negative effects derived from FDI can be found by analyzing the collected data. The real effects of foreign direct investments are limited since several factors could be a key driver behind the changes of the measured effects. Nonetheless, in some analyzed changes there is a possibility to see patterns that correlate with inward foreign direct investments