Political governance, civil liberties, and human capital: Evaluating their effect on foreign direct investment in emerging and developing economies

Fragkiskos Filippaios, Fatima Annan-Diab (), Amir Hermidas () and Charikleia Theodoraki ()
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Fatima Annan-Diab: Kingston University
Amir Hermidas: Credit Suisse
Charikleia Theodoraki: University of Kent

Journal of International Business Studies, 2019, vol. 50, issue 7, No 3, 1103-1129

Abstract: Abstract We study the influence of a country’s political governance on its attractiveness to foreign direct investors. We argue that democracy is not a unidimensional concept and that the effect of host-country political governance on incoming foreign direct investment (FDI) differs depending on whether FDI originates from a democratic or an autocratic country. We also hypothesize that the effect of civil liberties depends on the motivations of investing multinational enterprises (MNEs) and that human capital moderates this relationship. We test our hypotheses on a sample of 35,000 investments in emerging and developing countries between 2003 and 2013.

Keywords: political governance; civil liberties; human capital; foreign direct investment; investment motivations (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (19)

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DOI: 10.1057/s41267-019-00239-3

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