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Free Market Institutions and FDI Performance in Emerging Asian Economies

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  • Vogiatzoglou Klimis

    (Faculty of Economics and Commerce, Hoa Sen University, Ho Chi Minh City, Viet Nam)

Abstract

This paper examines long-term developments in the quality and efficiency of free market institutional systems across thirteen emerging economies from South, South-east, and East Asia over the 1995–2014 period. The paper also empirically assesses the impact of free market institutions on a country’s inward foreign direct investment (FDI) performance. We find that the free market institutional framework in most economies is still relatively inefficient, restrictive, and underdeveloped but has, nevertheless, substantially improved during the last twenty-year period. Our empirical results also indicate that a free market institutional system in a host-country is a factor that attracts inward FDI to emerging Asian economies by multinational companies. Consequently, policy makers should focus on further improving the quality of free market institutions.

Suggested Citation

  • Vogiatzoglou Klimis, 2016. "Free Market Institutions and FDI Performance in Emerging Asian Economies," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 52(1), pages 43-58, December.
    • Handle: RePEc:vrs:ijomae:v:52:y:2016:i:1:p:43-58:n:4
    DOI: 10.1515/ijme-2016-0026
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    More about this item

    Keywords

    economic institutions; multinationals; FDI; Asia; developing countries;
    All these keywords.

    JEL classification:

    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
    • 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
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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