 Natural Resources and FDI in GCC CountriesInternational Journal of Business and Social Research, 2016, vol. 6, issue 7, 12-22 Abstract: Natural resources are a blessing for some countries to attract FDI but cursed for others. Existing literature argues the suggestion that resource-rich countries attract less FDI because of resource (oil) price volatility. This study examines that natural resources discourage FDI in GCC countries (the FDI-Natural resources curse hypothesis), using panel data analysis for six oil dependent countries during 1980-2013 and applying several econometrics techniques. The main findings of this paper is that natural resources measured by oil rents have a negative association with FDI inflows; this negative impact is robust even when other FDI determinates of FDI are included. FDI inflows decreased between 0.15 and 0.92% when oil rents increased by 1%. In addition, the empirical results show that trade openness and labour force are the main factors that encourage FDI, while political instability and corruption deter FDI inflows into GCC countries. Keywords: Economic growth; endogeneity; FDI; GCC region; natural resources; panel data. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:lrc:larijb:v:6:y:2016:i:7:p:12-22 Access Statistics for this article More articles in International Journal of Business and Social Research from LAR Center Press |
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