The Determinants of Foreign Direct Investment Inflows to Jordan (A Preliminary Analysis)
12 Pages Posted: 20 Aug 2011
Date Written: August 20, 2011
Foreign direct investment has become an increasingly important channel for developing countries to enhance their economic and financial systems. A significant part of economic and financial research is the view that a host country's risks affect investment inflows. The purpose of this paper is to identify the determinants of foreign direct investment inflows to Jordan. Model is formalised based on the theory of foreign direct investment and the missing gaps in the literature. This study covered a period from 1996 to 2009. Quarterly data for collective political, financial and economic, data obtained from risk rating agency annuals and foreign direct investment in Jordan acquired from the Jordanian Central Bank and the Jordan Securities Commission. The country risk rating model indicates that the economic risk political risk and GDP are statistically significant in influencing FDI inflows to Jordan.
Keywords: Foreign direct investment (FDI), Political Risk, Economic Risk, Financail Risk
JEL Classification: F40
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