Economics at your fingertips  

Political culture and foreign direct investment: The case of Italy

Ram Mudambi and Pietro Navarra ()

Economics of Governance, 2003, vol. 4, issue 1, 37-56

Abstract: Does the political culture of an area have any impact on the foreign direct investment (FDI) decisions of multinational corporations (MNCs)? This question is difficult to address empirically, as locations differ in many dimensions. We therefore address this question by examining MNC investment location decisions with regard to different regions within a single country. The country we examine is Italy, which exhibits one of the highest levels of variation with regard to the political culture of its geographical regions. We find that political culture as represented by the pattern of support for political parties at different points on the political spectrum has a significant impact on the MNC investment location decision. Thus, in choosing between locations on a short list, where economic and financial location factors are roughly similar, political culture can have a determining influence. In the case of Italy, a Center-right orientation is conducive to MNC FDI, while a Center-left orientation is not. A Far-left orientation is found to have a very negative effect on FDI. Copyright Springer-Verlag Berlin Heidelberg 2003

Keywords: Key words: Foreign direct investment; political culture; MNCs; JEL Classification Numbers: F23; D72; D73 (search for similar items in EconPapers)
Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link) (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10101/PS2

DOI: 10.1007/s101010100031

Access Statistics for this article

Economics of Governance is currently edited by Amihai Glazer and Marko Koethenbuerger

More articles in Economics of Governance from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

Page updated 2024-03-31
Handle: RePEc:spr:ecogov:v:4:y:2003:i:1:p:37-56