EMPIRICAL RESEARCH REGARDING THE FACTORS THAT INFLUENCE FOREIGN PARTICIPATION IN THE SHARE CAPITAL OF ROMANIAN COMPANIES

Mariana Sehleanu ()
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Mariana Sehleanu: Universitatea din Oradea

Annals of Faculty of Economics, 2017, vol. 1, issue 1, 181-191

Abstract: Foreign investment represents an important variable of economic development at global level. According to Romanian National Trade Register Office statistics (ONRC, 2017), the value of subscribed capital (initial registration) in companies with foreign participation in Romania had an oscillatory evolution during 1991 and 2016. It recorded relative small values during 90’s and increased slowly from 2001, reaching a peak in 2008 when the value of subscribed capital was 5924,8 million USD. Economic and financial conditions at the global level were reflected in a decrease of the value of subscribed capital due to the lack of financing and restricted access to credit and lack of liquidity. The lowest value recorded from 2001 until present was registered in 2015, i.e. 1428,5 million USD. In terms of number of companies with foreign participation registered, there was an increase from 5.499 in 1991 to 15.720 in 2007, when the highest number was recorded. From 2008 until present, the number of companies with foreign participation registered annually decreased and reached 5.348 in 2016, which represented a level below that of 1991. However, in recent years the mean value of subscriptions has increased compared to the one specific to the period between 1991 and 2004.The aim of this research is to analyze the influence of several factors on the value of subscribed capital in companies with foreign participation in the share capital in Romania, between 1991 and 2015. Using simple regression models, the study reveals that factors such as gross domestic product (GDP), research & development expenditure, exchange rate, labour cost and infrastructure have an important role in explaining the value of subscribed capital in companies with foreign participation in Romania, trade openness has a moderate influence on the value of subscribed capital, while the number of graduates has a weak influence. Between the value of subscribed capital in companies with foreign participation in Romania and research&development, trade openness, infrastructure, GDP, exchange rate, respectively graduates, there is a direct and linear correlation and between the value of subscribed capital (initial registration) and labour cost there is an inverse linear correlation.

Keywords: foreign subscribed capital; companies; Romania. (search for similar items in EconPapers)
JEL-codes: F21 (search for similar items in EconPapers)
Date: 2017
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