Foreign Direct Investment and Trade Openness: The Case of Developing Economies

Liargovas, Panagiotis; Skandalis, Konstantinos S.

doi:10.1007/s11205-011-9806-9

Cited by 168 publications

(113 citation statements)

References 20 publications

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“…The coefficient is positive and significant (P<0.05), providing support for hypothesis 1. This is also consistent with previous research that suggest a positive relationship between trade openness and FDI inflows (Blonigen & Piger, 2014;Liargovas & Skandalis, 2012;Shirazi et al, 2010).…”

Section: Resultssupporting

confidence: 93%

“…We also include human-capital related factors as suggested by Globerman and Shapiro (2003) to test whether the human capital capabilities (such as education and well-being) play a role in FDI inflows across and between countries. (Liargovas & Skandalis, 2012) argue that trade openness plays a positive and significant role in attracting FDI inflows. The authors studied this relationship in the context of developing countries, selecting only those countries that are considered developed under the categorization of the united nation.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

See 1 more Smart Citation

Governance, Regulations, Trade Openness and FDI Inflows: Empirical Study

Al‐Shammari

Hammoudeh

Pavlovic

2015

IJEF

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Governance effectiveness and regulation quality have been drawing the attention in the international business arena, yet, there has not been a consensus findings regarding its potential impact on the FDI inflows. In this paper, we examine the possible links between the governments' effectiveness and their regulation quality and the amount of FDI inflows using the existing literature and theories in the economic and international business fields. We find that regulation quality, control of corruption, and trade openness have mixed results, suggesting that further exploration is needed in this field. Results are explained and future directions are suggested based upon the empirical findings.

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Section: Resultssupporting

confidence: 93%

Section: Literature Review and Hypothesesmentioning

confidence: 99%

Governance, Regulations, Trade Openness and FDI Inflows: Empirical Study

Al‐Shammari

Hammoudeh

Pavlovic

2015

IJEF

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“…Consistent with Liargovas and Skandalis (2012) [60], our study empirically revealed a positive and significant relationship between market size (GDP as a proxy) and FDI. This result is clearly justified by an assertion that investors have an intention of accruing maximum returns on their investments.…”

Section: Discussion Of the Empirical Resultssupporting

confidence: 90%

“…Çevis & Çamurdan (2007) [8] [30] found GDP (measuring market size) as having a positive impact on FDI flows using panel data with an elasticity of 0.92 and 1.2 using cross-sectional data. Liargovas and Skandalis (2012) [60] …”

Section: Literature Reviewmentioning

confidence: 99%

Financial Reforms and Determinants of FDI: Evidence from Landlocked Countries in Sub-Saharan Africa

et al. 2017

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The recognition of Foreign Direct Investment (FDI) as a source of funding to foster economic development in both developed and developing countries has been in ascendancy. The prime purpose of this study is to empirically investigate the determinants of FDI for the "landlocked countries" in Sub-Saharan Africa over the period 1995-2013. By employing panel data analysis, the result of the study revealed that domestic investment, trade (openness), human capital, political constraint, natural resource endowment and the market size (with the GDP growth as proxy) as having positive impact on determining FDI flow into the sample countries with only the countries' tax policies seen otherwise. Our study not only contributes to existing literature on FDI determinants by investigating landlocked countries of Sub-Saharan Africa (SSA) for the first time but also includes natural resources that the landlocked countries are endowed with, tax policies and political constraints in such countries for the stipulated period.

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“…Contrary to the majority of research findings, Asiedu (2002) argued that trade openness' impact on FDI relies on the type of investment and, more specifically, market seeking investments have a positive relationship with lower levels of trade openness, as they are linked to trade restrictions. The reason behind this is the "tariff jumping" hypothesis, stating that foreign companies seeking to enter local markets while findings difficulties in importing their goods, may decide to establish subsidiaries in the host country (Liargovas and Skandalis, 2012). Hypothesis 6a: Inward FDI are positively affected by the level of openness of the host market.…”

Section: Trade Opennessmentioning

confidence: 99%