Analysing major determinants of European FDI into the Mediterranean countries
AbstractForeign direct investment (FDI) is known as a very relevant driver of economic growth and has found increased attention in recent trade research. Existing theories differ, however, in their conclusion regarding the relation between trade in goods and FDI: they appear to be either complements or substitutes depending on the theory applied and specific country conditions. Benefits or losses for individual member countries resulting from these different relationships are relevant for evaluating the effects of regional trade areas as established by the Euro-Mediterranean Partnership. This paper offers an empirical analysis of the connection between trade and FDI flows in the agribusiness sector in the context of the Euro-Mediterranean partnership. It contributes to the limited literature in this area by providing an overview on relevant theories and their conclusion on the relationship between trade and FDI. Determinants implied by the single theories are identified and reasonable proxies derived for the carried out econometric analysis. The empirical analysis shows mixed evidence on the complementary or substitutive relationship of FDI and trade in agricultural goods. For comparison and better interpretation of determinants’ impacts identified by the econometric analysis, a further analysis between the EU15 and the Mercosur countries is carried out. Finally, further research needs in this area of trade analyses are identified for the specific case of the Euro-Mediterranean Partnership.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Association of Agricultural Economists in its series 2008 International Congress, August 26-29, 2008, Ghent, Belgium with number 44053.
Date of creation: 2008
Date of revision:
Foreign Direct Investment; Trade; EU-Med Partnership; International Relations/Trade;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-11-25 (All new papers)
You can help add them by filling out this form.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If references are entirely missing, you can add them using this form.