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Foreign Direct Investment Attractiveness of Central, Eastern, and Southeastern European Countries: The Importance of Policy-Related Location Advantages

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  • Svilena Mihaylova

    (University of Economics – Varna, Bulgaria)

Abstract

The paper aims to enhance the discussion about foreign direct investment (FDI) attractiveness of Central, Eastern, and Southeastern European (CESEE) countries, by focusing on those location determinants of FDI which fall within the scope of public policy. First, we summarize the literature on location advantages. Second, some general trends in FDI inflows to the CESEE region are outlined. Third, based on data for 15 CESEE countries in 2013 and 2017, we build a composite index, which allows us to rank countries in terms of their FDI attractiveness, as well as its most important policy-related dimensions, such as institutional framework, infrastructure endowment, labor force quality, and cost competitiveness. In addition to allowing comparison between economies across these dimensions, the results reveal areas in which some countries need improvement so that they can attract more FDI.

Suggested Citation

  • Svilena Mihaylova, 2020. "Foreign Direct Investment Attractiveness of Central, Eastern, and Southeastern European Countries: The Importance of Policy-Related Location Advantages," Croatian Economic Survey, The Institute of Economics, Zagreb, vol. 22(1), pages 65-101, June.
    • Handle: RePEc:iez:survey:ces-v22_1-2020_mihaylova
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    References listed on IDEAS

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    1. John H. Dunning & Sarianna M. Lundan, 2008. "Multinational Enterprises and the Global Economy, Second Edition," Books, Edward Elgar Publishing, number 3215.
    2. Dunning, John H, 1979. "Explaining Changing Patterns of International Production: In Defence of the Eclectic Theory," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 41(4), pages 269-295, November.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Thi-Nham Le & Thanh-Tuan Dang, 2022. "An Integrated Approach for Evaluating the Efficiency of FDI Attractiveness: Evidence from Vietnamese Provincial Data from 2012 to 2022," Sustainability, MDPI, vol. 14(20), pages 1-25, October.

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    More about this item

    Keywords

    foreign direct investment; public policy; economic comparison; composite index;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation

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