EconPapers    
Economics at your fingertips  
 

The Determinants and Impacts of Foreign Direct Investment

Delali Accolley

MPRA Paper from University Library of Munich, Germany

Abstract: Some theories on the determinants and impacts of Foreign Direct Investment (FDI) are presented and critically discussed. In the empirical investigations which follow this, the effects of some macroeconomic variables such as economic growth, market size, degree of openness, real effective exchange rate, and labor cost on flows of FDI into the USA have been tested. In the specification of the econometric model, account has been taken of the fact that economic growth could be both a determinant and impact of FDI inflows. The main finding is that economic growth in the USA does not explain the long-run behavior of the FDI inflows equation. It can explain its short run behavior but not significantly. Besides, it has been found that FDI inflows contribute to economic growth in the USA. Open-market operations have been proposed as economic policy to attract FDI flows.

Keywords: FDI; Foreign Direct Investment; Direct Investment; Investment aboroad; FDI Inflows; FDI Outflows; Cointegration; 2SLS; two stage least squares; greenfield FDI (search for similar items in EconPapers)
JEL-codes: F2 F21 (search for similar items in EconPapers)
Date: 2003-10-21
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/3084/1/MPRA_paper_3084.pdf original version (application/pdf)

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:pra:mprapa:3084

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2022-06-18
Handle: RePEc:pra:mprapa:3084