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The determinants of foreign direct investment in MENA countries: an extreme bounds analysis

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  • Imad Moosa

Abstract

The determinants of foreign direct investment inflows are examined by applying extreme bounds analysis to a cross-sectional sample encompassing data on 18 Middle Eastern and North African countries. With the gross domestic product growth rate serving as the free variable, eight potential explanatory variables are tried as the variables of interest in combination with three other variables. The results reveal that only one variable is robust when traditional EBA is used. However, when restricted EBA is used, the results based on the 60% of the regressions with the highest R2 reveal three more robust variables. Some explanations for the results are put forward.

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  • Imad Moosa, 2009. "The determinants of foreign direct investment in MENA countries: an extreme bounds analysis," Applied Economics Letters, Taylor & Francis Journals, vol. 16(15), pages 1559-1563.
    • Handle: RePEc:taf:apeclt:v:16:y:2009:i:15:p:1559-1563
    DOI: 10.1080/13504850701578819
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    6. Sekkat, Khalid, 2012. "Manufactured Exports and FDI in Southern Mediterranean Countries: Evolution, determinants and prospects," CEPS Papers 6849, Centre for European Policy Studies.
    7. Dimitrova, Anna & Triki, Dora & Valentino, Alfredo, 2022. "The effects of business- and non-business-targeting terrorism on FDI to the MENA region: The moderating role of political regime," International Business Review, Elsevier, vol. 31(6).
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    9. Philipp Mandel & Bernd Süssmuth, 2011. "Total Instructional Time Exposure and Student Achievement: An Extreme Bounds Analysis Based on German State-Level Variation," CESifo Working Paper Series 3580, CESifo.
    10. Tjeerd M. Boonman & Andrea E. Sanchez Urbina, 2020. "Extreme Bounds Analysis in Early Warning Systems for Currency Crises," Open Economies Review, Springer, vol. 31(2), pages 431-470, April.
    11. Mohammad Shaiful Islam & Ahmed Beloucif, 2024. "Determinants of Foreign Direct Investment: A Systematic Review of the Empirical Studies," Foreign Trade Review, , vol. 59(2), pages 309-337, May.
    12. Muhammad Zubair Mumtaz & Zachary A. Smith & Ather Maqsood Ahmed, 2016. "An examination of short-run performance of IPOs using Extreme Bounds Analysis," Estudios de Economia, University of Chile, Department of Economics, vol. 43(1 Year 20), pages 71-95, June.
    13. Sahar Hassan Khayat, 2017. "Institutional Dimension of Investment Profile, Natural Resources & Foreign Direct Investments: A Case of MENA Oil Producing Countries," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(8), pages 33-39, August.
    14. Nam, Hyun-Jung & Ryu, Doojin, 2023. "FDI and human development: The role of governance, ODA, and national competitiveness," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 85(C).
    15. Nam, Hyun-Jung & Bang, Jeongseok & Ryu, Doojin, 2023. "Do financial and governmental institutions play a mediating role in the spillover effects of FDI?," Journal of Multinational Financial Management, Elsevier, vol. 69(C).
    16. Brahim Elmorchid & Nouira Ridha & Khalid Sekka, 2013. "A Comparative Analysis of the Determinants of Foreign Direct Investment in The Arab World and in Asia," Working Papers 811, Economic Research Forum, revised Dec 2013.
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    18. Fosu, Prince, 2016. "Infrastructure and Foreign Direct Investment Inflows: Evidence from Ghana," MPRA Paper 100375, University Library of Munich, Germany, revised 13 May 2020.

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