Author(s): Li Sheng (GTRC), Yanming Tsui (DECP)
Most economics and urban literature focuses on the economic aspects of foreign investors' impact on cities and defends their positive role in urban development. This paper takes a different approach by developing an urban economics model for tourist cities that illustrates how, when there is local underinvestment and a large influx of foreign labour, transnational enterprises may make their profits at the expense of local businesses. Therefore, it is the government's responsibility to regulate foreign investment in a way that is conducive to sustainable development. Macao is adopted as a case study. Copyright c 2010 John Wiley & Sons, Ltd.