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Determinants of FDI attractiveness: A MCI model approach

Author

Listed:
  • Helmi Hammami

    (Rennes School Business)

  • Moez Hammami

    (Quantylix)

  • Siriki Coulibaly

    (Quantylix)

  • Mariem Marzouk

    (Quantylix)

Abstract

This study aims to use a Multiplicative Competitive Interaction approach to identify the major factors that influence the decision to engage in foreign direct investment (FDI) by focusing on the ease of doing business index and its subindexes (institutional quality) and GDP (market size). Results are drawn from an annual dataset on 175 countries between 2005 and 2015. Empirical findings suggest institutional effect dominates market size effect, and therefore, to be more competitive in attracting FDI, countries must increase their business environment's efficiency by mainly focusing on judicial system improvement.

Suggested Citation

  • Helmi Hammami & Moez Hammami & Siriki Coulibaly & Mariem Marzouk, 2020. "Determinants of FDI attractiveness: A MCI model approach," Economics Bulletin, AccessEcon, vol. 40(2), pages 1033-1048.
    • Handle: RePEc:ebl:ecbull:eb-19-00096
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    References listed on IDEAS

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    More about this item

    Keywords

    Foreign direct investment; Multiplicative Competitive Interaction (MCI) model; market size; business environment; fiscal policy;
    All these keywords.

    JEL classification:

    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics
    • F2 - International Economics - - International Factor Movements and International Business

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