From FDI Attraction to Domestic Competitiveness

Abstract

This chapter traces the relative decline of the previous FDI attraction paradigm and the emerging paradigm of domestic technology competitiveness, drawing on government documents, media text analysis, and interviews. The chapter then introduces the actors, arguments, and the matrix of supporting institutions and policy tools underpinning the two policy paradigms. It draws attention to the coexistence of the two paradigms at the local level, where policies and institutions of FDI attraction profoundly affect the government’s response to domestic upgrading and their choice of development strategies.