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Foreign direct investment in Turkey: regional determinants

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  • Joel Deichmann
  • Socrates Karidis
  • Selin Sayek

Abstract

The uneven regional distribution of foreign direct investment (FDI) in Turkey poses an interesting question from the perspective of multinational firms (MNFs) and policy-makers alike. This paper focuses on the factors governing the location decisions of MNFs within Turkey with specific reference to policy implications. Using a conditional logit model, it is found that agglomeration, depth of local financial markets, human capital, and coastal access dominate location decisions for the aggregate sample of foreign investors in Turkey. This study reveals no evidence that public investment is successful in attracting MNFs to particular regions. Also importantly, the location determinants vary dramatically by broad industrial category, investment composition, and origin-country characteristics, including income category and region.

Suggested Citation

  • Joel Deichmann & Socrates Karidis & Selin Sayek, 2003. "Foreign direct investment in Turkey: regional determinants," Applied Economics, Taylor & Francis Journals, vol. 35(16), pages 1767-1778.
    • Handle: RePEc:taf:applec:v:35:y:2003:i:16:p:1767-1778
    DOI: 10.1080/0003684032000126780
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    References listed on IDEAS

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