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Foreign Direct Investment: a comparative study of the attraction of Moroccan and Tunisian economies (In French)

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  • Dalila NICET-CHENAF (GREThA)
  • Eric ROUGIER (GREThA)

Abstract

The existing literature points to a series of determinants of FDI attraction such as the size of markets, the costs of labor, infrastructure, the educational level of the labor force, or policy reforms and political stability … However, potential trade-offs or complementarities between similar countries are rarely underscored as factors explaining the performance or the under-performance in attracting FDI. In this paper we try to determine if there is an inverse (positive) relationship between FDI flows in Tunisia and in Morocco. We test this hypothesis is tested in a VAR model (Vector Autogressive Regression) and we show that FDI in Tunisia attract, in an indirect way, the FDI in Morocco, probably by improving the climate of business in the region. But, meanwhile, Morocco undergoes a significant diversion of FDI in favour of Tunisia in the long run.

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Bibliographic Info

Paper provided by Groupe de Recherche en Economie Théorique et Appliquée in its series Cahiers du GREThA with number 2007-02.

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Date of creation: 2007
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Handle: RePEc:grt:wpegrt:2007-02

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Keywords: Foreign direct investment (FDI) ; trade-off; attraction ; Morocco ; Tunisia;

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  1. Stevens, Guy V. G., 1998. "Exchange Rates and Foreign Direct Investment: A Note," Journal of Policy Modeling, Elsevier, vol. 20(3), pages 393-401, June.
  2. Bruce A. Blonigen, 2005. "A Review of the Empirical Literature on FDI Determinants," NBER Working Papers 11299, National Bureau of Economic Research, Inc.
  3. Wheeler, David & Mody, Ashoka, 1992. "International investment location decisions : The case of U.S. firms," Journal of International Economics, Elsevier, vol. 33(1-2), pages 57-76, August.
  4. James R. Markusen & Anthony J. Venables & Denise Eby Konan & Kevin H. Zhang, 1996. "A Unified Treatment of Horizontal Direct Investment, Vertical Direct Investment, and the Pattern of Trade in Goods and Services," NBER Working Papers 5696, National Bureau of Economic Research, Inc.
  5. James R. Markusen, 1995. "The Boundaries of Multinational Enterprises and the Theory of International Trade," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 169-189, Spring.
  6. Ricardo Hausmann & Dani Rodrik, 2002. "Economic Development as Self-Discovery," NBER Working Papers 8952, National Bureau of Economic Research, Inc.
  7. Stephen Ross Yeaple, 2003. "The Role of Skill Endowments in the Structure of U.S. Outward Foreign Direct Investment," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 726-734, August.
  8. Susan E. Feinberg & Michael P. Keane, 2001. "U.S.-Canada Trade Liberalization And Mnc Production Location," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 118-132, February.
  9. Hartman, David G., 1985. "Tax policy and foreign direct investment," Journal of Public Economics, Elsevier, vol. 26(1), pages 107-121, February.
  10. Helpman, Elhanan, 1984. "A Simple Theory of International Trade with Multinational Corporations," Scholarly Articles 3445092, Harvard University Department of Economics.
  11. Ewe-Ghee Lim, 2001. "Determinants of, and the Relation Between, Foreign Direct Investment and Growth: A Summary of the Recent Literature," IMF Working Papers 01/175, International Monetary Fund.
  12. Klinger, Bailey & Lederman, Daniel, 2004. "Discovery and development : an empricial exploration of"new"products," Policy Research Working Paper Series 3450, The World Bank.
  13. Benoît Mercereau, 2005. "FDI Flows to Asia: Did the Dragon Crowd Out the Tigers?," IMF Working Papers 05/189, International Monetary Fund.
  14. David G. Hartman, 1985. "Tax Policy and Foreign Direct Investment in the United States," NBER Working Papers 0967, National Bureau of Economic Research, Inc.
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Cited by:
  1. Jean-Bernard LAYAN (GREThA UMR CNRS 5113) & Yannick LUNG (GREThA UMR CNRS 5113), 2008. "Attractiveness and agglomeration of automotive industry in Morocco and Tunisia: A comparative analysis (In French)," Cahiers du GREThA 2008-20, Groupe de Recherche en Economie Théorique et Appliquée.

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