Foreign Investments in Less Developed Regions
The profitability of foreign investments in the periphery of the modern, capitalist system is important in the study of imperialism and dependency and, through these intermediary subjects, of the causes of war and revolution. It is also relevant to theories regarding the multinational corporation, international markets, and modernization and economic development. To shed light on these subjects, this article assesses the profitability of foreign investments in less developed regions by examining two cases of special relevance: the experience of British capitalists during the high age of imperialism in the late nineteenth and early twentieth centuries and the operations of U.S. multinational corporations after World War II. For each period the return on foreign investments in the less developed areas will be compared to that earned on such investments in the developed countries. These cases were chosen because of the political, military, and economic preeminence of Britain prior to World War I and the United States today. If great national power produces material benefits for investors, it should be apparent in these cases.