Question

Suppose an American buys stock issued by an Argentinian corporation. The Argentinian firm uses the proceeds from the sale to build a new office complex.

This is an example of foreign investment in Argentina.

Which of the following policies are consistent with the goal of increasing productivity and growth in developing countries? Check all that apply.

Increasing taxes on income from savings

Imposing restrictions on foreign ownership of domestic capital

Pursuing inward-oriented policies

Providing tax breaks and patents for firms that pursue research and development in health and sciences

In less developed countries, what does the term brain drain refer to?

Lower productivity due to a malnourished workforce

The emigration of highly skilled workers to rich countries

Rapid population growth that lowers the stock of capital per worker

Rapid population growth that increases the burden on the educational system

Answer 1