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Does growth attract FDI?

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  • Iamsiraroj, Sasi
  • Doucouliagos, Hristos

Abstract

FDI is seen widely as a vital source of investment, technology transfer, and growth. The factors that attract FDI have been a longstanding source of debate. The authors present a comprehensive assessment of the accumulated evidence on one factor, the success of economic growth in attracting FDI. Meta-regression analysis is applied to 946 estimates from 140 empirical studies. The authors show that there is a robust positive correlation between growth and FDI. Significantly larger correlations are established for single country case studies than with cross-country analysis. It also appears that growth is slightly more correlated with FDI in developing countries.

Suggested Citation

  • Iamsiraroj, Sasi & Doucouliagos, Hristos, 2015. "Does growth attract FDI?," Economics Discussion Papers 2015-18, Kiel Institute for the World Economy (IfW).
  • Handle: RePEc:zbw:ifwedp:201518
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    References listed on IDEAS

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    More about this item

    Keywords

    economic growth; FDI; meta-regression analysis;

    JEL classification:

    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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