Structural Policy Reform and the Distribution of FDI in Europe

WIFO Working Paper No. 174

21 Pages Posted: 14 Feb 2002

See all articles by Fritz Breuss

Fritz Breuss

Vienna University of Economics and Bus. Admin., Europe Institute

Peter H. Egger

Ifo Institute for Economic Research - International Trade and Foreign Direct Investment; Ludwig-Maximilians University of Munich; CESifo (Center for Economic Studies and Ifo Institute for Economic Research

Michael Pfaffermayr

University of Innsbruck - Department of Economics; Austrian Institute of Economic Research

Date Written: January 29, 2002

Abstract

The envisaged EU enlargement will lead to a redirection of Structural and Cohesion Funds expenditures from current to new EU members. This redistribution of funds makes the accession countries even more attractive as a location of FDI. Using a logistic regressions approach, this paper shows that a hypothetical reallocation of Structural Funds as envisaged by Agenda 2000 leads to a redistribution of FDI by approximately 0.8 percentage points from the current EU members to the accession countries (first round) and 2.6 percentage points (second round), respectively.

Keywords: FDI, Structural Funds, Gravity equation, European integration, Panel econometrics

JEL Classification: C33, F14, F15

Suggested Citation

Breuss, Fritz and Egger, Peter H. and Pfaffermayr, Michael, Structural Policy Reform and the Distribution of FDI in Europe (January 29, 2002). WIFO Working Paper No. 174, Available at SSRN: https://ssrn.com/abstract=300405 or http://dx.doi.org/10.2139/ssrn.300405

Fritz Breuss

Vienna University of Economics and Bus. Admin., Europe Institute ( email )

Althanstrasse 39-45
1090 Vienna
Austria

Peter H. Egger

Ifo Institute for Economic Research - International Trade and Foreign Direct Investment ( email )

Poschingerstr. 5
Munich, DE-81679
Germany
+49 0 89 9224 1238 (Phone)
+49 0 89 985369 (Fax)

HOME PAGE: http://www.cesifo-group.de/portal/page?_pageid=36,425628&_dad=portal&_schema=PORTAL

Ludwig-Maximilians University of Munich

Schackstr. 4
Munich, 80539
Germany

CESifo (Center for Economic Studies and Ifo Institute for Economic Research

Poschinger Str. 5
Munich, DE-81679
Germany

Michael Pfaffermayr (Contact Author)

University of Innsbruck - Department of Economics ( email )

Universitaetsstrasse 15
A-6020, Innsbruck
Austria
+43 512 507 7359 (Phone)

HOME PAGE: http://homepage.uibk.ac.at/~c43236/

Austrian Institute of Economic Research ( email )

P.O. Box 91
Wien, A-1103
Austria
+43 1 798 26 01-253 (Phone)
+43 1 798 93 86 (Fax)

HOME PAGE: http://www.wifo.ac.at/Michael.Pfaffermayr/

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