Foreign Direct Investment and Institutional Environment in Transition Economies

Kostevc, Črt; Redek, Tjaša; Sušjan, Andrej

doi:10.1007/s11300-007-0140-5

Cited by 47 publications

(26 citation statements)

References 27 publications

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“…His study showed that the decline in production and employment in inefficient domestic firms due to structural reforms in these countries neutralize or even outweigh the positive effect of FDI on economic growth. Contrary to these findings, Kostevc et al (2007) found that FDI can assist in the process of economic growth of transition economies. Variables such as secondary school enrollment as a measure of human capital also had a positive impact on economic growth, albeit not a significant impact, as well as gross-fixed capital accumulation.…”

Section: Effects Of Fdicontrasting

confidence: 68%

“…If we were analyzing the FDI in SEECs utilizing the methods employed in for investigations of the effects and determinants in the articles subject to this comparison, the best suited for us would be the methodological approach by Kostevc et al (2007). They succeeded in collecting the most relevant data for examining the effects and determinants of FDI.…”

Section: Suggestions For the Methodsmentioning

confidence: 99%

“…First, both studies found that governmental action is important to achieve better macroeconomic effects of inward FDI deals (C-B M&A represent approximately 75% of FDI on the global scale). Kostevc et al (2007) suggested that the governments of transitional countries should focus primarily on creating a good legal system. Second, both studies stressed that, in countries included in the analysis, FDI inflow can assist in the process of economic growth.…”

Section: Suggestions For the Methodsmentioning

confidence: 99%

See 2 more Smart Citations

Analyzing FDI Economic Effects and Determinants in SEE Economies: Comparative approaches

Zvezdanovic¹

2013

OurEconomy

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Section: Effects Of Fdicontrasting

confidence: 68%

Section: Suggestions For the Methodsmentioning

confidence: 99%

Section: Suggestions For the Methodsmentioning

confidence: 99%

See 1 more Smart Citation

Analyzing FDI Economic Effects and Determinants in SEE Economies: Comparative approaches

Zvezdanovic¹

2013

OurEconomy

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“…Global and country-specific actors (Kostevc et al, 2007) are equally important in determining the long-run movements in equity flows for both Asian and Latin American countries. One study (Globerman and Shapiro, 1999) on Canadian FDI inflow using US and UK GDP for world economic situation, as the two countries are major partners of the Canadian trade, showed statistically insignificant relationship.…”

Section: Global Factorsmentioning

confidence: 99%

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Hailu¹

2010

IJBM

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This paper aims at providing empirical analysis of the demand side determinants of the inflow of Foreign Direct Investment to African nations, with particular emphasis on stock market availability. Due to data heterogeneity, non-continuity and because the Hausman test favors it, cross section fixed effect Least Square Dummy Variable (LSDV) estimation technique is used. Natural resource, labor quality, trade openness, market accession and infrastructure condition are found to have positive and significant effect. Availability of stock market has the expected positive but insignificant effect. In search of possible explanation governments' expenditure and private domestic investment are added to the regression equation and are found to have positive effect, ruling out the possibility of crowding out effect. Stock markets in Africa are not structured in such a way that they can contribute to attract FDI and hence policy makers should restructure capital markets to get the most out of them. The bottom line is, policy makers of those countries have a lot of demand side instruments under their discretion to attract FDI inflow.

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“…This process does not include a simple ownership transformation of state enterprises but also the creation of favourable environment for the emergence and development of the private sector. FDI assists in the process of economic growth of these economies since it increases the degree of competition in the domestic market, as well as the efficiency of local companies (Kostovc et al, 2007). This type of capital flow represents opportunity to reduce technological gap between transition and developed countries.…”

Section: Introductionmentioning

confidence: 99%

Institutions as a Mediator of the Effect of Crossborder Mergers & Acquisitions on Domestic Investment

Lobanova¹,

Kračun²,

Kavkler³

2018

Prague Economic Papers

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In this article we analyse the impact of the interaction between cross-border mergers and acquisitions and the quality of the institutional setting on domestic investment using panel data for 22 European transition countries from 2000 to 2014. We investigate whether the progress and durability of institutional reforms have a crucial influence on the economic performance of crossborder mergers and acquisitions in transition countries. Our empirical findings indicate that contemporaneous cross-border mergers and acquisitions have a crowding-out effect on domestic investment in the year of merger or acquisition, but the influence of their lagged level has a strong crowding-in effect one year later. We find that the overall quality of the institutional setting and the rule of law negatively and significantly affect the relation between this type of foreign direct investment and domestic investment, both in the short and long run. Political stability exhibits a positive and significant impact on domestic investment in the current period and over time.

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Foreign Direct Investment and Institutional Environment in Transition Economies

Abstract: economic transition, institution, economic growth, foreign direct investment, E6, O4,

Cited by 47 publications

References 27 publications

Analyzing FDI Economic Effects and Determinants in SEE Economies: Comparative approaches

Analyzing FDI Economic Effects and Determinants in SEE Economies: Comparative approaches

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Institutions as a Mediator of the Effect of Crossborder Mergers & Acquisitions on Domestic Investment

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