Abstract
This paper explores and compares the determinants of Foreign Direct Investment (FDI) in South and South-east Asia over 21 periods ranging from 1996 to 2016. Using panel data regression with random effects and fixed effects models, the study finds that market size, labour productivity and infrastructure of the host country exercise a significant influence upon FDI inflows of both regions. Trade openness, inflation rate, natural resource endowment and the unemployment rate are more important in South Asia, while the exchange rate, control of corruption and political stability are more important in South-east Asia for foreign investors. It appears that foreign investors hold different perceptions of investment attributes while deciding investment location into these two regions. The results imply that in seeking to become a potential destination of FDI, policies for both regions should be devised towards market growth, political stability, and the development of the quality of infrastructure, human capital and labour productivity. Sound macroeconomic stability with a flexible and stable exchange rate system is also needed to attract FDI.
Original language | English |
---|---|
Title of host publication | Proceedings of the 2020 British Academy of Management Annual Conference |
Publisher | British Academy of Management |
Number of pages | 21 |
Publication status | Accepted/In press - 8 Jun 2020 |
Event | British Academy of Management 2020 Conference in the Cloud: Innovating for a Sustainable Future - Virtual Duration: 2 Sept 2020 → 4 Sept 2020 https://www.bam.ac.uk/resource/get-ready-for-bam2020-in-the-cloud--conference-virtual-platform-and-app-are-now-live-.html (Event website.) |
Conference
Conference | British Academy of Management 2020 Conference in the Cloud |
---|---|
Abbreviated title | BAM2020 |
Period | 2/09/20 → 4/09/20 |
Internet address |
Keywords
- FDI
- determinants
- FDI inflows
- panel data
- South and South-east Asia