Administrative costs of regulation and foreign direct investment: the Standard Cost Model in non-OECD countries

Jacopo Torriti () and Eka Ikpe ()

Review of World Economics (Weltwirtschaftliches Archiv), 2015, vol. 151, issue 1, 127-144

Abstract: In recent years both developed and developing countries have experienced an increasing number of government initiatives dedicated to reducing the administrative costs (AC) imposed on businesses by regulation. We use a bi-linear fixed-effects model to analyze the extent to which government initiatives to reduce AC through the Standard Cost Model (SCM) attract foreign direct investment (FDI) among 32 developing countries. Controlling for standard determinants of the SCM, we find that the SCM in most cases leads to higher FDI and that the benefits are more significant where the SCM has been implemented for a longer period. Copyright Kiel Institute 2015

Keywords: Administrative costs; Foreign direct investment; Developing countries; Standard Cost Model; F43; H83 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s10290-014-0200-y

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