Determinants of Foreign Direct Investment in Transition Economies: with Particular Reference to Macedonia’s Performance - Softcover

Zulfiu Alili, Merita

Softcover

ISBN 10: 365953627X ISBN 13: 9783659536274

Publisher: LAP LAMBERT Academic Publishing, 2014

Synopsis

Using a panel dataset of bilateral flows of foreign direct investment (FDI), we study the determinants of FDI in transition economies, with particular reference to Macedonia’s performance. Even though Macedonia has been introducing extensive fiscal and business sector reforms, so far it has been lagged in attracting foreign investment. Following the empirical approach used in previous studies and the theoretical discussion presented in Chapters 2 this study specifies both static and dynamic models. The static models, both fixed and random effects, do not give the best specification. The empirical work confirms the expectation of the positive feedback effect of past FDI onto current FDI. The negative and significant coefficient of distance indicates that FDI is determined by gravity factors. In addition, GDP of the host country, unit labour costs, trade openness, English language are also important determinants of FDI in transition economies. Our suggestion is that the econometric findings on the determinants of FDI in transition economies using small dataset and static models should be accepted only with caution.

About this title

About the Author

Merita Zulfiu Alili, PhD: completed her master and PhD studies in economics at Staffordshire University, United Kingdom. She works at South East European University, Macedonia. Merita's scientific interests are: foreign direct investment, transition economies, labour market inequality, wage inequality, skill intensity of employment.

Edition details

• Publisher: LAP LAMBERT Academic Publishing
• Publication date: 2014
• Language: English
• ISBN 10: 365953627X
• ISBN 13: 9783659536274
• Binding: Paperback
• Number of pages: 88