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Revisiting the relationship between governance and foreign direct investment

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  • Pierre-Guillaume Méon
  • Khalid Sekkat

Abstract

Using a sample of 96 countries over the nineties, this paper examines the extent to which different dimensions of governance affect FDI inflows. It considers six aspects of governance. The results of a least-squares estimation suggest a positive relationship between institutional quality and FDI. However, when the issue of the endogeneity of governance is tackled thanks to 2SLS regressions, the relationship appears much weaker.

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Bibliographic Info

Article provided by ULB -- Universite Libre de Bruxelles in its journal Brussels economic review.

Volume (Year): 50 (2007)
Issue (Month): 1 ()
Pages: 41-61

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Handle: RePEc:bxr:bxrceb:y:2007:v:50:i:1:p:41-61

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Keywords: Institutions; governance; foreign direct investment;

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Citations

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Cited by:
  1. Kuloglu, Ayhan & Lobont, Oana-Ramona & Topcu, Mert, 2012. "A question of causality between political corruption, economic freedom and economic growth in Europe," MPRA Paper 40365, University Library of Munich, Germany.
  2. Bernal, Oscar & Oosterlinck, Kim & Szafarz, Ariane, 2010. "Observing bailout expectations during a total eclipse of the sun," Journal of International Money and Finance, Elsevier, vol. 29(7), pages 1193-1205, November.
  3. Sile Padraigin O'Dorchai, 2008. "Pay inequality in 25 European countries," DULBEA Working Papers 08-06rs, ULB -- Universite Libre de Bruxelles.
  4. Jean Luc De Meulemeester, 2007. "L'économie de l'éducation fait-elle des progrès? Une perspective d'histoire de la pensée économique," DULBEA Working Papers 07-15.RS, ULB -- Universite Libre de Bruxelles.
  5. Olivier Debande & Jean Luc De Meulemeester, 2008. "Quality and variety competition in higher education," DULBEA Working Papers 08-12.RS, ULB -- Universite Libre de Bruxelles.
  6. Strand, Jon, 2009. ""Revenue management"effects related to financial flows generated by climate policy," Policy Research Working Paper Series 5053, The World Bank.
  7. Jérôme De Henau & Leila Maron & Danièle Meulders & Sile Padraigin O'Dorchai, 2007. "Travail et maternité en Europe: conditions de travail et politiques publiques," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 50(1), pages 63-88.
  8. Abdeslam Marfouk, 2008. "The African brain drain: scope and determinants," DULBEA Working Papers 08-07.RS, ULB -- Universite Libre de Bruxelles.
  9. Pierre-Guillaume Méon & Ariane Szafarz, 2008. "Labour market discrimination as an agency cost," Working Papers CEB 08-019.RS, ULB -- Universite Libre de Bruxelles.
  10. Benoît Mahy & François Rycx & Mélanie Volral, 2008. "L'influence de la dispersion salariale sur la performance des grandes entreprises belges," Reflets et perspectives de la vie économique, De Boeck Université, vol. 0(3), pages 27-40.
  11. Ariane Szafarz, 2007. "Hiring people-like-yourself: a representation of discrimination on the job market," DULBEA Working Papers 07-21.RS, ULB -- Universite Libre de Bruxelles.
  12. Charles Plaigin, 2009. "Exploratory study on the presence of cultural and institutional growth spillovers," DULBEA Working Papers 09-03.RS, ULB -- Universite Libre de Bruxelles.
  13. Michele Cincera & Henri Capron, 2007. "EU pre-competitive and near-the-market S&T collaborations," DULBEA Working Papers 07-17.RS, ULB -- Universite Libre de Bruxelles.
  14. Henri Capron, 2007. "Politique de cohésion et développement régional," DULBEA Working Papers 07-16.RS, ULB -- Universite Libre de Bruxelles.
  15. Hassan Ayoub & Jérôme Creel & Etienne Farvaque, 2008. "Détermination du niveau des prix et finances: le cas du Liban 1965-2005," DULBEA Working Papers 08-10.RS, ULB -- Universite Libre de Bruxelles.

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