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Abstract

It is commonly alleged that foreign direct investment (FDI) in Pakistan has positive
consequences for the domestic labor market. The effects of FDI on the domestic labor
market are a very controversial issue in most countries experiencing high or growing
unemployment. Over the past two decades, Pakistan received a major chunk of foreign
direct investment from developed countries. The objective of this study is to undertake an
empirical study on creation of employment opportunities by FDI during 2005-2010 in
Pakistan, This paper shows that this widely accepted view does not generally hold.

.( Implications for FDI policy are spelt out in the light of these empirical results.)YE
LINE BHI INTRO MAI DAL DENA

INtRO( INTRO MAI YE POINTS DALO K THESE ARE THE AIMS OF FDI IN
ALMOST EVERY COUNTRY

• Resource-seeking: FDI aims at securing access to raw materials required for


production and has positive consequences for the domestic labor market.

• Efficiency-seeking: FDI primarily aims at reducing the cost of producing goods


and
services and has a negative impact on domestic employment.

• Market-seeking: FDI aims at securing and developing existing foreign markets and
at gaining access to new markets and has a positive impact on the home economy

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