EconPapers    
Economics at your fingertips  
 

The effect of natural disasters on FDI attraction: a sector-based analysis over time and space

Thomas Neise (), Franziska Sohns (), Moritz Breul () and Javier Revilla Diez ()
Additional contact information
Thomas Neise: Osnabrück University
Franziska Sohns: University of Greenwich
Moritz Breul: University of Cologne
Javier Revilla Diez: University of Cologne

Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, 2022, vol. 110, issue 2, No 7, 999-1023

Abstract: Abstract Extensive research has addressed the question of why some countries are able to attract a large amount of foreign direct investment (FDI), while others are not. Until now, this research mostly neglected natural disasters as a business risk. In the realm of natural disaster research, some studies have investigated the effect of natural disasters on FDI inflow. However, this research remains overly simplistic and conceals the complexities of the underlying relationship. As such, this article aims to provide a more deciphered perspective by considering variations across economic sectors and the dynamic effect of natural disasters. We apply hybrid panel regressions to a dataset of 181 countries over a period of 13 years across four different economic sectors. The analysis shows that the effect of natural disasters on FDI inflow varies among economic sectors. From a longitudinal perspective, the study finds a positive relationship between exposure to natural disasters and the inflow of FDI within countries 3 and 5 years after an event. Overall, the findings highlight the complex nature of the relationship between natural disasters and FDI and warn against using too simplistic approaches.

Keywords: Foreign direct investment; Multinational enterprises; Risk; Hybrid panel regression; Sector-specific analysis (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s11069-021-04976-3 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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: https://EconPapers.repec.org/RePEc:spr:nathaz:v:110:y:2022:i:2:d:10.1007_s11069-021-04976-3

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11069

DOI: 10.1007/s11069-021-04976-3

Access Statistics for this article

Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards is currently edited by Thomas Glade, Tad S. Murty and Vladimír Schenk

More articles in Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards from Springer, International Society for the Prevention and Mitigation of Natural Hazards
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2022-05-12
Handle: RePEc:spr:nathaz:v:110:y:2022:i:2:d:10.1007_s11069-021-04976-3