A large part of the discussion draws on evidence from the US and Sweden, for good reasons. Both countries have systematically collected data on the outward investments by national corporations since the 1970s, facilitating detailed analysis at the macro level. Moreover, MNCs occupy dominant positions in both economies, accounting for most of manufacturing employment, exports, and research and development (R&D) outlays.1 Section 2 starts with a discussion regarding the motives for outward investment, to identify some of the expected effects on the investing company (the parent company) and the home country. Section 3 looks at the evidence regarding the effects of FDI on home country exports, Section 4 examines the effects of FDI on industry structure in the home country, Section 5 discusses some other home country effects of FDI, Section 6 summarizes some of the policy responses to outward FDI, and Section 7 concludes by discussing whether the effects on developing home countries can be expected to be similar.