The Spatial Interdependence of FDI in Latin America

Luisa R. Blanco

World Development, 2012, vol. 40, issue 7, 1337-1351

Abstract: Using a sample of 17 Latin American countries, with observations during 1986–2006, two forms of spatial interdependence of foreign direct investment (FDI) are explored: (1) surrounding market potential, and (2) spatial autocorrelation. We find that surrounding market potential has a positive significant effect on net FDI, but there is no evidence that FDI is spatially autocorrelated. Other factors that show a significant positive effect on FDI include control of corruption and exports of raw materials. When considering only FDI inflows from the US, we find that FDI is spatially autocorrelated, and that surrounding market potential is not significant.

Keywords: foreign direct investment; spatial econometrics; Latin America (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (17)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:wdevel:v:40:y:2012:i:7:p:1337-1351

DOI: 10.1016/j.worlddev.2012.02.003

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