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Corruption Heterogeneity and Foreign Direct Investment

Author

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  • Tuan Viet Le

    (Thomas H. Albinson School of Business, West Virginia Wesleyan College, Buckhanon, WV, USA2Faculty of Economics – Management, Dong Nai Technology University, Bien Hoa, Vietnam)

Abstract

In this research, I study the relationship between bilateral Foreign Direct Investment (FDI) and difference in corruption between source and host countries. Using instrumental variables (IVs) approach, the results suggest that bilateral FDI between two countries might increase if the difference in corruption between them decreases. In addition, I find that firms from corrupt countries tend to invest abroad to exploit natural resources while those from less corrupt countries take advantage of relatively low local wages and open trade policies.

Suggested Citation

  • Tuan Viet Le, 2021. "Corruption Heterogeneity and Foreign Direct Investment," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 12(01), pages 1-14, February.
    • Handle: RePEc:wsi:jicepx:v:12:y:2021:i:01:n:s1793993321500058
    DOI: 10.1142/S1793993321500058
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    Cited by:

    1. Lidia Maria BRUMA, 2023. "Cloud Incident Response - a Comprehensive Analysis," Informatica Economica, Academy of Economic Studies - Bucharest, Romania, vol. 27(4), pages 32-43.

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