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Determinants of Foreign Direct Investment in Developed and Emerging Markets

Author

Listed:
  • Jerzy Rozanski

    (University of Lodz)

  • Pawel Sekula

    (University of Lodz)

Abstract

We analyzed FDI determinants for 26 developed economies and 25 emerging markets. The analysis was conducted using a panel regression model for the period 1996-2014 as well as macroeconomic and institutional variables. Growth dynamics, increasing welfare, and the size of the market positively influence FDI. Among institutional variables, government stability index and the rule of law index exert positive impact upon FDI. Misgivings with respect to the quality of democracy and corruption do not undermine FDI inflow.

Suggested Citation

  • Jerzy Rozanski & Pawel Sekula, 2016. "Determinants of Foreign Direct Investment in Developed and Emerging Markets," Dynamic Econometric Models, Uniwersytet Mikolaja Kopernika, vol. 16, pages 49-64.
    • Handle: RePEc:cpn:umkdem:v:16:y:2016:p:49-64
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    References listed on IDEAS

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    Cited by:

    1. Lucke, Bernd & Rehfeldt, Erik, 2023. "How does expropriation affect FDI? A synthetic control analysis of oil and gas sector nationalizations in South America," European Journal of Political Economy, Elsevier, vol. 80(C).

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    More about this item

    Keywords

    developed economies; emerging markets; foreign direct investment; institutional determinants; panel data;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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