Lithuanian Regional FDI During the Litas Period, 1997-2013

Abstract

FDI in to the ten counties of Lithuania 1997-2013 is substantial and widely dispersed. Applying a standard model of FDI impact on regional economic growth reveals dispersion of FDI as well as the amount has contributed to stronger regional growth. Results are not sensitive to the uniqueness of greater Vilnius though the county with the national capital continues to attract the most FDI and has suffered least from the demographic crisis. Greater attention to human capital development outside of greater Vilnius is recommended to continue to attract FDI to rural areas of the country with a focus on new goods exports to enhance labour productivity.

Keywords: Lithuania, Local FDI, Regional Analysis

JEL Classification: F3, P2, P25