The Influence of Human Development, Institutional Quality and ISIS Emergence on Foreign Direct Investment in Iraq
Zeravan Asaad () and
Bayar MohamedRasheed Marane ()
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Bayar MohamedRasheed Marane: Cihan University - Duhok, University of Duhok, Kurdistan Region - Iraq
Technium Social Sciences Journal, 2020, vol. 10, issue 1, 318-332
This study investigates the influence of human development and institutional quality on the foreign direct investment net inflows on the gross domestic product in Iraq for the period (2004-2016) by using OLS regression. The empirical results show that governance sub-indicators do not actually matter much in attracting Foreign Direct Investment (FDI) inflows in Iraq. This variable shows fixed results with a different sign; the Political Stability (PS), Government Effectiveness (GE) and Rule of Law (RL) are the sub-indicators of the governance with a positive sign which is insignificant, while the Voice and Accountability (VA), Regulatory Quality (RQ) and Control of Corruption (CC) are the sub-indicators of the governance index with a negative sign and an insignificant impact on FDI inflows. The value of Worldwide Governance Indicators (WGI) coefficient is negative and significant at 10% level. Hence it has been concluded that the explanatory variables are negatively associated with the dependent variable FDI. In contrast, the Human Development Index (HDI) has a positive and significant impact on FDI inflows. This study found that Islamic State of Iraq and Syria (ISIS) emergence after (2013) had a significant coefficient, meaning that ISIS has affected the level of FDI inflows.
Keywords: Foreign Direct Investment; Human Development; Institutional Quality; Governance Sub-Indicators (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:tec:journl:v:10:y:2020:i:1:p:318-332
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