The Relative Success of IFRS Adopted African Countries to Attract Foreign Investment

Oberholzer Merwe (), Omotoso Matthew Olubayo, Schutte Danie and Buys Pieter
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Oberholzer Merwe: North-West University, South Africa
Omotoso Matthew Olubayo: North-West University, South Africa
Schutte Danie: North-West University, South Africa
Buys Pieter: North-West University, South Africa

Studia Universitatis Babeș-Bolyai Oeconomica, 2022, vol. 67, issue 1, 44-62

Abstract: Within the context that the adoption of International Financial Reporting Standards (IFRS) can be linked to institutional isomorphism, the purpose of the study was to determine how successful IFRS-adopted African countries are to convert governance and economic factors into foreign direct investment (FDI) and foreign portfolio investment (FPI). Data envelopment analysis (DEA) was used to develop two models to calculate the technical efficiency (TE) for 16 African countries that adopted IFRS (2014-2019). The first model considered how multiple economic factors as input variables are converted into FDI and FPI, while similarly, the second model considered governance factors as input variables.

Keywords: International Financial Reporting Standards (IFRS); foreign direct investment (FDI); foreign portfolio investment (FPI); data envelopment analysis (DEA); institutional isomorphism (search for similar items in EconPapers)
JEL-codes: C61 F18 M41 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:subboe:v:67:y:2022:i:1:p:44-62:n:3

DOI: 10.2478/subboec-2022-0004

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