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Uncovering the Attractiveness of the Romanian Market: A Data-Driven Approach

Author

Listed:
  • Daniel Lipara

    (“Ovidius” University of Constanta, Faculty of Economic Sciences, Romania)

  • Marian Ionel

    (“Ovidius” University of Constanta, Faculty of Economic Sciences, Romania)

Abstract

The purpose of this study is to examine the elements that strengthened market attractiveness in Romania, between 2000 and 2022. To fulfil this, we considered a selection of variables upon which we carried out a Principal Component Analysis that allowed to underline the factors associated with Romanian market attractiveness. After exploring the correlation between Foreign Direct Investment, Gross Domestic Product, Labor Force Participation Rate, Logistics Performance Index and Political Stability, the PCA unveiled five components, with the first two accounting for 83.01% of the total variance in the data. Formulated on the initial variables' loadings on these components, FDI, GDP, LFPR, LPI, and POLSTABILITY appear to be significant factors that promoted market attractiveness in Romania. Still, a more in-depth analysis and interpretation of the data is required to fully comprehend the factors that make attractive the Romanian market.

Suggested Citation

  • Daniel Lipara & Marian Ionel, 2023. "Uncovering the Attractiveness of the Romanian Market: A Data-Driven Approach," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 267-276, December.
    • Handle: RePEc:ovi:oviste:v:xxiii:y:2023:i:2:p:267-276
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    References listed on IDEAS

    as
    1. Al Mustofa, Muhammad Ubaidillah & Sukmana, Raditya, 2021. "The Effect of Institutional Quality on Foreign Direct Investment," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 55(3), pages 77-88.
    2. Tatomir, Cristina F. & Popovici, Oana, 2011. "Eyes on Romania: what to look when investing here?," MPRA Paper 36140, University Library of Munich, Germany.
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      More about this item

      Keywords

      principal components; economic growth; investment; employment; market structure;
      All these keywords.

      JEL classification:

      • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
      • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
      • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
      • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
      • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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