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The Effect of Political Risk on Foreign Direct Investment:The Case of Algeria


  • Midoun Sissani

    () (Faculty of Economic, Management and Commercial Sciences, University Ibn-Khaldoun, Tiaret , Algeria)

  • Zairi Belkacem

    () (Faculty of Economic and Management Sciences and Commercial Sciences,Oran University,Oran, Algeria)


Both political risk and financial risk represent a great loss of profitable opportunities in the host countries and a serious threat on the attractiveness of foreign direct investments (FDI)in almost all developing countries among them Algeria. Methods & results: This paper attempts to study the significant relationship between political risk, financial risk and their effects on Foreign Direct Investment (FDI) in Algeria during 1990 to 2012.In fact, our analysis revealed that political has a negative relationship with (FDI) however financial risk was strong.

Suggested Citation

  • Midoun Sissani & Zairi Belkacem, 2014. "The Effect of Political Risk on Foreign Direct Investment:The Case of Algeria," Hyperion Economic Journal, Faculty of Economic Sciences, Hyperion University of Bucharest, Romania, vol. 2(3), pages 29-35, September.
  • Handle: RePEc:hyp:journl:v:2:y:2014:i:3:p:29-35

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    Political risk; financial risk; foreign direct investments;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • 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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