The expectation of knowledge spillovers is a major motivation for governments to attract foreign investors to their country.

Question

Quizplus · Accepted Answer

Knowledge spillovers occur when foreign investors bring new technologies, processes, and knowledge to the host country, which can benefit domestic firms and lead to innovation and economic growth. Therefore, many governments offer incentives and favorable policies to attract foreign investment to their countries in the hope of benefiting from such knowledge spillovers.

The Expectation of Knowledge Spillovers Is a Major Motivation for Governments