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Determinants of Foreign Direct Investment in Iceland

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Author Info
Helga Kristjánsdóttir (University of Iceland)

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Abstract

This paper investigates whether the low foreign direct investment in Iceland can be explained by its geographical location together with market size measures. The effects of these factors on inward FDI are analyzed by means of the gravity model. The model is also applied to analyze sector, trade bloc and country specific effects. The research is based on panel data, running over countries, sectors and years. Results indicate that distance negatively affects FDI and that FDI appears to be more driven by wealth effects than market size effects.

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File URL: http://www.econ.ku.dk/CAM/Files/workingpapers/2005/2005-15.pdf
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Publisher Info
Paper provided by University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics in its series CAM Working Papers with number 2005-15.

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Length: 28 pages
Date of creation: Sep 2005
Date of revision:
Handle: RePEc:kud:kuieca:2005_15

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Related research
Keywords: foreign direct investment; gravity model;

Find related papers by JEL classification:
F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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  21. Nicolini, Rosella, 1997. "Exportation and Foreign Direct Investment in Visegrad Area : An Empirical Analysis," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 1997028, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES). [Downloadable!]
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Full references

Cited by:
(explanations, 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. Belkacem Laabas and Walid Abdmoulah, . "Determinants of Arab Intraregional Foreign Direct Investments," API-Working Paper Series 0905, Arab Planning Institute - Kuwait, Information Center. [Downloadable!]
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