Andrew Schrank, Entrepreneurship, Export Diversification, and Economic Reform: The Birth of a Developmental Community in the Dominican Republic

Why do different export platforms appeal to different types of investors? The origins of  investment in the Dominican Republic¡¯s export processing zones can be traced to two features of their regional environments: the nature of the region¡¯s relationship to the world market and the power of the region¡¯s indigenous capitalist class. The first predicts whether zones will lure investors; the second, who will invest in them. Thus, the traditionally integrated sugar growing southeast and tobacco, cocoa, and coffee growing north feature successful zones, while the traditionally isolated import-substituting and subsistence agricultural regions to the south have unsuccessful ones. The traditionally foreign-dominated southeastern zones are dominated by foreigners, while the traditionally domesticated northern zones are dominated by Dominicans.

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