Regional healthcare infrastructure disparities and foreign direct investment into Europe

Juliane Sormain and Michael Ryan

Economics and Business Letters, 2023, vol. 12, issue 1, 49-61

Abstract: This study examines the impact of sub-national healthcare infrastructure heterogeneity on the location choice of inward foreign direct investment (FDI). We do so by employing an augmented gravity model on Japanese firm-level FDI into European NUTS-2 regions during the period 2000-2017. Differences in each region's per capita number of hospital beds and practicing physicians highlight the healthcare infrastructure heterogeneity across Europe. Our negative binomial estimation results indicate that both hospital beds and practicing physicians significantly positively attract inward FDI, with physician density having the more significant impact. The findings are consistent with the hypothesis that the quality of local institutions is a determinant of FDI attraction.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:ove:journl:aid:17531

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