Evaluation of Foreign Direct Investment Contribution in the Economic Development of Sverdlovsk Region and Russia

Larisa Kapustina (), Ľudmila Lipková and Oksana Falchenko ()
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Ľudmila Lipková: University of Economics in Bratislava
Oksana Falchenko: Ural State University of Economics

Economy of region, 2016, vol. 1, issue 3, 741 - 754

Abstract: The article discusses the role of foreign direct investment in the economy of receiving region and country on the example of the Russian Federation and Sverdlovsk region. The positive and negative effects of foreign capital in national and regional economies are marked. A set of indicators to assess the impact of foreign direct investment in the host region economy is offered to determine the trends of attracting foreign capital in the last decade and the role of foreign direct investment in the economic development of the Sverdlovsk region and the Russian Federation. The examples of investment projects with the participation of foreign companies which were successfully implemented in the Sverdlovsk region have been considered. The conclusion about higher rates of the transnationalization of economic activity in Russia in comparison with similar processes in the Sverdlovsk region is made. In the paper, a comparative statistical analysis of the development of the economy of the country and Sverdlovsk region by attracting internal or investment resources is provided. The comparative analysis shows that the country and region economy does not depend much on the foreign direct investment inflows. With the help of the econometric analysis, we have confirmed the hypothesis about a weak impact of foreign direct investment on economic growth in the Sverdlovsk region and the Russian Federation. The results of the calculations for the Sverdlovsk Region and the Russian Federation show that domestic investment in fixed assets is the key factor for the growth of the gross regional product and the gross domestic product.

Keywords: transnationalization effects; foreign direct investment; foreign-invested companies; host region; host country; gross domestic product; gross regional product (search for similar items in EconPapers)
Date: 2016
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