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Foreign direct investment in the Spanish regions: What are the influencing factors?


  • Gutiérrez-Portilla, Paula

    () (University of Cantabria)

  • Maza, Adolfo

    (University of Cantabria)

  • Villaverde, José

    (University of Cantabria. Kemmy Business School, University of Limerick, Limerick (Ireland))

  • Hierro, María

    (University of Cantabria)


The purpose of this paper is to analyze foreign direct investment (FDI) flows in Spain at regional and sectoral levels over the period 1997-2013. After showing that they are very volatile and highly geographically concentrated, the paper examines their determinants by estimating an FDI equation by GMM and GLS. This is done not only for the whole period and total FDI but also for two sub-periods (pre-crisis and crisis) and main places of origin (Europe and America). The results show that FDI inflows in Spain are mainly determined by market size, the level of human capital in interaction with wages, and the own characteristics of Madrid.

Suggested Citation

  • Gutiérrez-Portilla, Paula & Maza, Adolfo & Villaverde, José & Hierro, María, 2016. "Foreign direct investment in the Spanish regions: What are the influencing factors?," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 35, pages 67-82.
  • Handle: RePEc:ris:invreg:0317

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    Cited by:

    1. Castillo-Murciego, Ángela & López Laborda, Julio, 2018. "The effect of Double Taxation Treaties and Territorial Tax Systems on Foreign Direct Investment: Evidence for Spain," Economics Discussion Papers 2018-21, Kiel Institute for the World Economy (IfW).
    2. Mariam Camarero & Laura Montolio & Cecilio Tamarit, 2018. "Determinants of FDI for Spanish regions: Evidence using stock data," Working Papers 1809, Department of Applied Economics II, Universidad de Valencia.

    More about this item


    foreign direct investment; Spanish regions;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes


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