The Relationship Between the Country Selection Decision of Foreign Portfolio Investments and the Economic Freedom Index

Cem Kartal and Mürüvet Acar Karaboğa
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Cem Kartal: Sakarya University of Applied Sciences
Mürüvet Acar Karaboğa: Zonguldak Bulent Ecevi̇t University

Journal of Finance Letters (Maliye ve Finans Yazıları), 2023, vol. 38, issue 120, 11-30

Abstract: First of all, countries with a higher level of economic freedom are more attractive to foreign investors. In this study, a multiple linear regression model covering 128 countries was created and analyzed in order to investigate the effects of 2019 and 2020 components that make up the economic freedom index on foreign portfolio investment in countries. The effect of the factors discussed in the study on the country selection decision for foreign portfolio investment was investigated and the findings revealed that the effect level of each component is different.

Keywords: Economic freedom index; Foreign portfolio investments; Variance inflation factor; Explanatory factor analysis (search for similar items in EconPapers)
JEL-codes: C33 G11 G17 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:acc:malfin:v:38:y:2023:i:120:p:11-30

DOI: 10.33203/mfy.1182652

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