Which of the following is true regarding the pragmatic nationalist view of FDI?
A) One aspect of pragmatic nationalism is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants.
B) The pragmatic nationalist view states that FDI always has a positive effect on the balance of payments which arises from the outflow of a foreign subsidiary's earnings and from the import of inputs from abroad.
C) According to pragmatic nationalist view, international production should be distributed among countries based on the theory of comparative advantage.
D) According to pragmatic nationalist view, FDI should not be allowed to enter into a country because its costs always outweigh its benefits.
E) The pragmatic nationalist view of FDI accepts the Marxist theory, and suggests that FDI by MNEs is an instrument of imperialism.

Question

Quizplus · Accepted Answer

The pragmatic nationalist view supports the idea of offering subsidies, tax breaks, or grants to foreign MNEs to attract FDI believed to be in the national interest. This promotes economic growth and development in the host country. However, it does not suggest that FDI always has a positive effect on the balance of payments, as stated in option B. Option C is incorrect as it does not reflect the pragmatic nationalist view, which does not support the theory of comparative advantage. Option D is incorrect as this view is not in favor of restricting FDI, but rather believes in attracting FDI that benefits the host country. Option E is incorrect as the pragmatic nationalist view does not support Marxist theories related to FDI.

Which of the Following Is True Regarding the Pragmatic Nationalist