Do institutions matter for foreign direct investment?

Ali, F.A., Fiess, N. and MacDonald, R. (2010) Do institutions matter for foreign direct investment? Open Economies Review, 21(2), pp. 201-219. (doi:10.1007/s11079-010-9170-4)

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Using a panel of 69 countries during 1981 and 2005, we investigate the role of institutions in determining foreign direct investment (FDI). We find that institutions are a robust predictor of FDI and that the most significant institutional aspects are linked to propriety rights. Using a novel data set, we also study the impact of institutions on FDI at the sectoral level. We find that institutions do not have a significant impact on FDI in the primary sector but that institutional quality matters for FDI in manufacturing, and particularly in services.

Item Type:Articles
Glasgow Author(s) Enlighten ID:MacDonald, Professor Ronald and Fiess, Dr Norbert
Authors: Ali, F.A., Fiess, N., and MacDonald, R.
Subjects:H Social Sciences > HF Commerce
H Social Sciences > HB Economic Theory
College/School:College of Social Sciences > Adam Smith Business School > Economics
Journal Name:Open Economies Review
ISSN (Online):1573-708X
Published Online:03 March 2010

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