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The Interplay Between Foreign Direct Investment, Security and European Integration: The Case of the Central and Eastern European Countries

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  • Carmen Raluca Stoian
  • Roger Vickerman

Abstract

A bi-directional relationship between FDI and economic reforms in ten Central European countries is tested, along with the role of the EU in breaking a potential vicious circle of insecurity, little investment, slow reforms, low prospects of EU membership and hence high insecurity. Using panel data regressions and a system of simultaneous equations, we find evidence that the prospect of EU membership has enhanced FDI in the less reformist candidates and that trade integration and increased EU financial assistance have improved FDI in the CEECs.

Suggested Citation

  • Carmen Raluca Stoian & Roger Vickerman, 2005. "The Interplay Between Foreign Direct Investment, Security and European Integration: The Case of the Central and Eastern European Countries," Studies in Economics 0509, School of Economics, University of Kent.
    • Handle: RePEc:ukc:ukcedp:0509
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    More about this item

    Keywords

    foreign direct investment determinants; economic transition; economic reforms; Central and Eastern Europe;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables
    • P26 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Property Rights

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