Determinants of Foreign Direct Investment A Sectoral and Institutional Approach

Using a dataset which breaks down FDI flows into primary, secondary and tertiary sector investments and a GMM dynamic approach to address concerns about endogeneity, the paper analyzes various macroeconomic, developmental, and institutional/qualitative determinants of FDI in a sample of emerging mar...

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Main Author: Yu, Jiangyan
Other Authors: Walsh, James P.
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2010, 2010
Series:IMF Working Papers; Working Paper
Subjects:
Fdi
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Summary:Using a dataset which breaks down FDI flows into primary, secondary and tertiary sector investments and a GMM dynamic approach to address concerns about endogeneity, the paper analyzes various macroeconomic, developmental, and institutional/qualitative determinants of FDI in a sample of emerging market and developed economies. While FDI flows into the primary sector show little dependence on any of these variables, secondary and tertiary sector investments are affected in different ways by countries' income levels and exchange rate valuation, as well as development indicators such as financial depth and school enrollment, and institutional factors such as judicial independence and labor market flexibility. Finally, we find that the effect of these factors often differs between advanced and emerging economies
Physical Description:27 p.
ISBN:1455202215
9781455202218