Patterns of Foreign Direct Investment in the New EU Countries
AbstractThe aim of the paper is to assess the determinants of foreign direct investment (FDI) inflow for the recent members of the EU (CEEC-41) using panel data methods. Our analysis is important because FDI is considered as a main contributor to economic development, modernization, income growth, catching-up process and changes in specialization structure. In this paper, we adopt a rigorous econometric model to explain the FDI inflows. We examine the role played by economic and non-economic factors in FDI attractiveness. Using the gravity model and recent econometric techniques, we obtain the unbiased and convergent estimators. From an econometric point of view, the use of a Fixed Effect Vector Decomposition (FEVD) estimator for the gravity model appears to be convenient for our data sample.
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Bibliographic InfoArticle provided by Institute for Economic Forecasting in its journal Romanian Journal for Economic Forecasting.
Volume (Year): 6 (2009)
Issue (Month): 2 (June)
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More information through EDIRC
gravity models; panel data models; FDI; CEE countries;
Find related papers by JEL classification:
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- P33 - Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Business, and Aid
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
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