Foreign Direct Investment Determinants in <scp>OECD</scp> and Developing Countries

Economou, Fotini; Hassapis, Christis; Φίλιππας, Νικόλαος; Tsionas, Efthymios G.

doi:10.1111/rode.12269

Cited by 56 publications

(41 citation statements)

References 39 publications

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“…This finding is consistent with previous studies on FDI determinants (e.g. Dellis, Sondermann, & Vansteenkiste, ; Economou, Hassapis, Philippas, & Tsionas, ). Moreover, our results further suggest that the governance quality of host countries plays an inevitable role in diversifying greenfield FDI in terms of both the number of projects and the number of investing countries.…”

Section: Resultssupporting

confidence: 93%

Effects of aid for trade on extensive and intensive margins of greenfield FDI

Ly‐My

Lee

2019

World Economy

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Using a panel dataset of 105 developing countries for the period 2003–15, this paper assesses the effects of Aid for Trade (AfT) on greenfield FDI flows to the aid‐recipient countries. Particularly, this paper classifies the total dollar value of greenfield FDI flows to each recipient country in terms of four different layers: the extensive and intensive margins of projects as well as the extensive and intensive margins of source countries. Applying the system GMM estimator, this paper finds that AfT not only increases the dollar value of FDI flows to the recipient countries but also helps diversify the greenfield projects and source countries. In addition, this paper finds that AfT has a greater effect for greenfield FDI from donor (developed) countries than from non‐donor (developing) countries. Among the three components of AfT, aid for trade‐related infrastructure and aid for trade policy regulations are found to have positive links with greenfield FDI, irrespective of source‐country groups, yet their effects are larger for developed source countries. In contrast, aid for building productive capacity hinders greenfield FDI flows from non‐donor countries, while it promotes greenfield FDI from donor countries. We offer some explanations for this finding.

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Section: Resultssupporting

confidence: 93%

Effects of aid for trade on extensive and intensive margins of greenfield FDI

Ly‐My

Lee

2019

World Economy

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“…Positive and significant impact of previous FDI levels on future FDI inflows is in line with existing research [109][110][111]. The presence of existing FDI is also a signal to potential investors that it is an environment in which it is possible to operate successfully.…”

Section: Research Results and Discussionsupporting

confidence: 83%

Terrorism as a Determinant of Attracting FDI in Tourism: Panel Analysis

Radić

2018

Sustainability

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The aim of this paper is to investigate whether terrorism is one of the important determinants affecting the investment decisions of foreign investors in tourism on a panel of 50 countries over the period 2000 to 2016. In addition to terrorism, the importance of three other theoretically significant determinants of attracting foreign direct investment (FDI) in tourism are explored—the previous level of FDI in tourism, the level of GDP and the international tourist arrivals. To obtain more reliable research results, the initial model is extended with certain control variables. The study uses system-GMM estimator for dynamic panel data models. The research results of a narrower and a wider model indicate that terrorism has no significant effect on the FDI inflow in tourism while international tourist arrivals significantly affect the future FDI in tourism in both models. Furthermore, the research results entail certain political connotations. In order to attract foreign investors in tourism, the most important factor is to ensure a stable macroeconomic environment with a competitive position in the Doing Business list and what better business conditions. Attention should also be focused on the security and preventive counter-terrorism, which will ensure that potential destinations reflect confidence, have a growth rate of tourist arrivals and, consequently, attract foreign investors.

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“…The paper of Economou et al (2017) examined the determinants of FDI flow in 24 OECD countries and 22 developing (non-OECD) countries using standard fixed effects panel as well as a dynamic panel approach. The first set of empirical results indicates market size, trade openness, unit labor cost, schooling, taxation, gross capital formation and institutional variables as important determinants of FDI for OECD countries.…”

Section: Foreign Direct Investment and Absorptive Capacitymentioning

confidence: 99%

“…The authors Dupasquier & Osakwe (2003), Anyanwu (2006), Abor et al (2008) and Inekwe (2013) argued that FDI can play an important role in development of countries efforts including the transfer of modern technologies and the enhancement of local workforce skills, resulting in increased productivity. Girma (2005) reports that negative impacts on TFP are due to the allocation of FDI in AC.…”

Section: Productivity and Fdimentioning

confidence: 99%

Analysis of absorptive capacity and foreign direct investment in the productivity of Brazilian municipalities

Ferraz

Costa

Fernandes

et al. 2018

Prod.

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This is an Open Access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. 1. Introduction Absorptive Capacity (AC) is one of the most influential concepts in management literature. First introduced by Cohen & Levinthal (1989) and then developed by Zahra & George (2002) when it comes to learning and innovation on a company, and currently is a key word for a variety of strategies, routines and learning processes that influence the company's ability to exploit the external knowledge needed to build other organizational capacities (Todorova & Durisin, 2007; Zahra & George, 2002). The diffusion and acquisition of knowledge determine companies' potential for innovation (Griliches, 1998). However, Absorptive Capacity is necessary to understand and transform external knowledge flows, essential to achieve innovation and growth of companies (Cohen & Levinthal, 1990). It is noteworthy that the focus of many studies is about organizational factors that facilitate or inhibit the transfer process, including the organization's Absorptive Capacity (Gonzales & Martins, 2015).

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Foreign Direct Investment Determinants in OECD and Developing Countries

Cited by 56 publications

References 39 publications

Effects of aid for trade on extensive and intensive margins of greenfield FDI

Effects of aid for trade on extensive and intensive margins of greenfield FDI

Terrorism as a Determinant of Attracting FDI in Tourism: Panel Analysis

Analysis of absorptive capacity and foreign direct investment in the productivity of Brazilian municipalities

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