Determinants of FDI Inflows in Advanced Economies: Does the Quality of Economic Structures Matter?
28 Pages Posted: 23 Jun 2017
Date Written: May 19, 2017
This paper investigates the role of economic structures as determinants of FDI inflows. We expand on the existing literature by focusing on advanced economies, using a newly available measure of FDI which cleans the data from statistical artefacts, such as financial round tripping, and by relying on a wide variety of measures that proxy the quality of a country’s economic structures. Our results show that there is an empirical relation from the quality of a host country’s economic structures to FDI inflows. These results are robust to various economic specifications and are confirmed when restricting our sample to euro area countries only.
Keywords: Foreign Direct Investment, Economic Structures, Institutions, Euro Area Countries
JEL Classification: F21, F23, L51, O43
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