FDI has received surprisingly little attention in theoretical and empirical work on openness and growth. This paper presents a theoretical growth model where MNCs directly affect the endogenous growth rate via technological spillovers. This is novel since other endogenous growth models with...

Two models where productivity growth is caused by spillovers from R&D are analyzed using a sample of nine manufacturing industries in six large OECD countries between 1979 and 1991. The first model is based on traditional productivity analysis, the second model on the endogenous growth theory....