An Analysis Of Neoclassical Growth Model With Foreign Capital Close Linkages
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Ojapinwa, T. V.
Odekunle, L. A.
De-Caritas Centre for Studies in Human Development in Africa (DECSHDA)
This paper shows that the relevance of foreign capital inflow in boosting economic growth and prosperity originated from both classical and neoclassical theories of growth which postulate that foreign capital inflow can supplement domestic investment funds to enhance the capacity of the economy to grow. Foreign capital inflows can provide the financial system WIth substantial resources if they are saved in form of deposits which could lead to a greater allocation of investments such as credits among not only the foreign capital-receiving population but also the non-receiving, in the long run. Foreign capitals that pass through the financial system are generally needed to ft/I the prevailing gap so that countries can grow more rapidly than their internal resources would otherwise allow.
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Economic development , Neoclassical school of economics
Ojapinwa, T. V. & Odekunle, L. A. (2016), An Analysis Of Neoclassical Growth Model With Foreign Capital Close Linkages. De-Caritas Journal of Management and Social Sciences, Vol. 8 (1): 123-129