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FDI in the European Union and Mena Countries: Institutional and Economic Determinants

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Author Info
José Caetano () (Universidade de Evora, Departamento de Economia, CEFAGE-UE)
Aurora galego () (Universidade de Evora, Departamento de Economia, CEFAGE-UE)

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Abstract

FDI flows to the Middle East and North Africa countries (MENA) have been relatively low when compared to the neighbouring European Union (EU) and to other developing and emerging countries. Furthermore, empirical research on FDI in these countries is relatively scarce. In this paper we use panel data regressions and consider a period of 9 years (since mid nineties) to investigate possible differences in the determinants of FDI performance in these regions. In particular, we use a panel of 42 countries which include 17 MENA countries and 25 European countries. Unlike previous studies, we consider the inward FDI performance index, as provided by UNCTAD, as dependent variable and include both institutional and macroeconomic variables as possible determinants of FDI. The aim is to investigate whether there are region-specific factors that are significant for FDI performance. We conclude that there are some significant differences on the institutional determinants of FDI performance, namely in what concerns Investment Freedom, Government Size and Trade Freedom.

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Publisher Info
Paper provided by University of Evora, CEFAGE-UE (Portugal) in its series CEFAGE-UE Working Papers with number 2009_09.

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Length: 23 pages
Date of creation: 2009
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Handle: RePEc:cfe:wpcefa:2009_09

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Related research
Keywords: Foreign Direct Investment; Determinants; Institutions; Middle East North Africa countries (MENA); European Union (EU); Panel Data.;

Find related papers by JEL classification:
F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Agnès Bénassy-Quéré & Maylis Coupet & Thierry Mayer, 2007. "Institutional Determinants of Foreign Direct Investment," The World Economy, Blackwell Publishing, vol. 30(5), pages 764-782, 05. [Downloadable!] (restricted)
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  2. Pierre-Guillaume Méon & Khalid Sekkat, 2004. "Does the Quality of Institutions Limit the MENA's Integration in the World Economy?," The World Economy, Blackwell Publishing, vol. 27(9), pages 1475-1498, 09. [Downloadable!] (restricted)
  3. Blonigen, Bruce A., 2002. "Tariff-jumping antidumping duties," Journal of International Economics, Elsevier, vol. 57(1), pages 31-49, June. [Downloadable!] (restricted)
  4. Daron Acemoglu & Simon Johnson & James A. Robinson, 2002. "Reversal Of Fortune: Geography And Institutions In The Making Of The Modern World Income Distribution," The Quarterly Journal of Economics, MIT Press, vol. 117(4), pages 1231-1294, November. [Downloadable!] (restricted)
    Other versions:
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This page was last updated on 2009-11-26.


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