Risk Instability and the Pattern of Foreign Direct Investment in the Middle East and North Africa Region
This paper demonstrates that instability associated with investment risk is critical in explaining the level of foreign direct investment for the Middle East and North Africa (MENA) countries, which generally have higher investment risk than developed countries. The empirical results support this hypothesis, whether either the standard deviation or the interquartile range is used as a measure of instability, in a dynamic panel model. The paper recommends a reorientation of policies toward those with a longer-term focus in order to help lower the degree of risk instability for MENA countries.
|Date of creation:||01 Aug 2004|
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- Aizenman, Joshua, 2003.
"Volatility, employment and the patterns of FDI in emerging markets,"
Journal of Development Economics,
Elsevier, vol. 72(2), pages 585-601, December.
- Joshua Aizenman, 2002. "Volatility, employment and the patterns of FDI in emerging markets," NBER Working Papers 9397, National Bureau of Economic Research, Inc.
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- White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
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