Does Foreign Ownership Improve Firm’s Productivity?An Analytical View

Foreign Direct Investment (FDI) is one of the vehicles which bring inflow of capital, technology upgradation, improvements in human productivity and efficiency in firms of the host country and also change in the ownership structure of the firms. This paper explores the relationship between foreign ownership of the firms and its impact on the productivity by reviewing the literature available over the period of 1976 to 2017. In majority of the cases over the years, scholars concluded that foreign ownership acquired through FDI promotes total productivity factor as well as labor productivity except in two cases, namely: family-owned firms and firms that employ unskilled labors.