Political Risk, Institutions and Foreign Direct Investment

Arbeitspapier

The paper explores the linkages between political risk, institutions and foreign direct investment inflows. Using different econometric techniques for a data sample of 83 developing countries and the period 1984 to 2003, we identify those indicators that matter most for the activities of multinational corporations. Overall, 12 different indicators for political risk and institutions are employed in the empirical analysis. The results show that government stability, the absence of internal conflict and ethnic tensions, basic democratic rights and ensuring law and order are highly significant determinants of foreign investment inflows.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: HWWA Discussion Paper ; No. 315

Classification and Topics

• Classification: Wirtschaft ; Multiple or Simultaneous Equation Models: Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models ; International Investment; Long-term Capital Movements ; Multinational Firms; International Business ; Multiple or Simultaneous Equation Models: Panel Data Models; Spatio-temporal Models
• Subject: Political Risk ; Institutions ; FDI ; Multinational Corporations ; Direktinvestition ; Länderrisiko ; Politische Stabilität ; Institutionalismus ; Schätzung ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hefeker, Carsten ; Busse, Matthias
• Event: Veröffentlichung
• (who): Hamburg Institute of International Economics (HWWA)
• (where): Hamburg
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/19287
• Last update: 10.03.2025, 11:45 AM CET