Reconsideration of the Effects of Political Factors on FDI: Evidence from Japanese Outward FDI
Ivan Deseatnicov and
Hiroya Akiba ()
Review of Economics & Finance, 2013, vol. 3, 35-48
This paper empirically examines the role of political factors in the Japanese outward Foreign Direct Investment (FDI) activities with a panel data of 30 developed or developing countries for the period of 1995-2009. The estimation model is constructed on the basis of the OLI (ownership, location and internalization advantages) and knowledge-capital models. Political factors, which represent multiple dimensions of each host country including important institutional assessments, are included as additional explanatory variables with market potential, wages, skilled workforce endowments, investment cost, and openness. It is found that Political factor perception by Japanese MNCs is sensitive to different levels of initial political stability in the host countries. Thus, the model with political factors and traditional explanatory variables reasonably explains recent Japanese outward FDI flows and reveals new patterns in its behavior.
Keywords: Foreign direct investment; Multinational corporations; Political factor (search for similar items in EconPapers)
JEL-codes: D73 F20 F21 F23 P48 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bap:journl:130104
Ordering information: This journal article can be ordered from
17 Alton Towers Circle, Unit 101 Toronto, ON, M1V3L8, Canada
Access Statistics for this article
Review of Economics & Finance is currently edited by H. Carlson
More articles in Review of Economics & Finance from Better Advances Press, Canada 17 Alton Towers Circle, Unit 101 Toronto, ON, M1V3L8, Canada.
Bibliographic data for series maintained by Carlson ().